First-time homeownership is an enormous milestone to reach. However, finding and acquiring your dream home can be stressful, especially when navigating the market for the first time. 

Below we explore new homeowner tips to help first-time buyers navigate the market and confidently put forward an offer on a property they have seen at an open home in Wellington.

Navigating the Property Market

While browsing properties and picking your dream home can be exciting, it can also be disheartening if you don’t know what’s realistically within your budget first. Knowing what is financially within your reach will help you narrow your options, allowing you to navigate the market more confidently. Two steps you can take include paying off as much pre-existing debt as possible and saving up a deposit.

Pay off pre-existing debts 

Whether you're settling a car loan or a considerable credit card spend, paying off as much debt before gaining a mortgage is wise. Doing so will increase your credit score and decrease your debt-to-income ratio, affecting your mortgage rates.

Start saving for a deposit

Now you have a clean slate. The next thing you’ll need to consider is your deposit. Look at what’s on the market that aligns with your budget and lifestyle. A quick browse of the market will help you form a realistic savings goal for the deposit. Most lenders will accept a 20% deposit of the total property value, lending the remaining 80%. Saving for a deposit of 20% is best but not always possible, talking to a Mortgage Adviser will assist in providing you with relevant options and gaining pre-approval.

However, first-time buyers may be eligible to apply for the First Home Loan scheme (subject to criteria), and the possible use of funds from KiwiSaver. Speak to your Mortgage Advisor about these options.

Choosing Your Loan Provider

Exercise due diligence and thoroughly research any loan providers you’re considering. Take advise from professionals and you can further discuss with solicitor or agent to repeatable mortgage brokers.

A Mortgage Adviser will be able to assess which banks will suit you your requirements, and you only need to fill out the one application. A mortgage advisor will also support you through the process and help explain and answer questions as you navigate your way.

Looking at each provider’s potential interest rates is also essential. An interest rate calculator online can help you estimate the potential return you will have to pay each month. The interest rates a provider gives you can depend on credit scores, home location, home price and loan amount, deposit, loan term, and the interest rate type, among other things.

When you have chosen your provider, the pre-approval process can get underway. Your loan provider will review your financial history and determine your loan terms. Once you receive pre-approval for your loan, you will know the budget you have to work with to purchase, meaning you can visit open homes with confidence in what you can afford.

Searching for Your Dream Home

While a first house may not be your dream home, you can still ensure it meets your non-negotiables. 

Before inspecting any properties, whether you’re browsing apartments for sale in Wellington central or suburban homes, define your list of non-negotiables and deal breakers. These lists could include the number of bedrooms and bathrooms a property has, the kitchen layout, and the location safety for young children or pets.

Consider what issues you’re willing to fix (e.g., repainting the walls) and what issues may be deal breakers (significant structural issues). Defining your non-negotiables will help you navigate the market with more intent. This way, you can narrow down your options and ensure you are happy with your chosen property. If you’re already working with a real estate agent, discuss your list with them so they can assist you with the search.

Arrange a Private Viewing

If there’s a property you’re interested in, see if the real estate agent can arrange a private viewing. A private viewing is an opportunity to get a closer look at the property, ensuring that no potential issues go unnoticed. Examine every inch of the property to ensure that everything checks off before placing an offer. Thorough research and patience are crucial when buying property and getting the perfect deal for your new home.

Know the Documents Like the Back of Your Hand

As with any legal document, ensure you thoroughly read and understand your loan contract and mortgage requirements. A property lawyer can help you smoothly navigate the legalities of buying property. For first-time buyers, this guidance can make the buying process far less stressful; a lawyer can help you understand the ins and outs of the contract, ensuring no step is left unchecked to avoid financial trouble down the road. We strongly recommend that all buyers engage with a solicitor to review property reports and contract agreements prior to submitting an offer.

Become a Homeowner with Lowe & Co

Becoming a homeowner is no small feat, but the pleasure and satisfaction of owning your own home make the hard yards well worth it.

Waking up every morning in a home you love is priceless. The team at Lowe and Co are here to help make this a reality for you. We know the ins and outs of the market and work hard to connect people with property. Whether you’re looking for a newly built property or one filled with character, the housing market in Wellington is rife with possibilities. Get in touch with our team today if you want to sell or buy property in Wellington.