Whether you’re a first-time buyer or an experienced investor, careful planning and attention to detail are essential. Buying property is a major decision that requires careful consideration. Consult with our real estate agents, financial advisors, and legal professionals to make informed decisions. This blog post signifies a comprehensive guide on what is very important for you to consider:
1. Evaluate the Purpose of the Purchase
• As your (family's) primary residence:
Consider long-term suitability for your family and your lifestyle.
• As an Investment:
Assess rental demand, tenant profiles, and potential for capital appreciation.
• As (your) vacation property:
Look into seasonal demand and proximity to attractions.
2. Set a budget (and keep it in mind):
• Assess Your finances:
Evaluate your income and expenses as well as existing savings or debts to determine how much you can afford for purchasing a property.
• Factor in additional (purchasing) costs:
Include expenses like property taxes, insurance, legal fees, and maintenance costs. And don't forget that there are additional purchasing costs like transfer duty and the fees for the attorney/conveyancer and the Deeds Office.
• Future expenses and exit strategy:
Budget for maintenance, upgrades, and unforeseen repairs. If the property is an investment, consider how and when you might sell or refinance.
• Get already pre-approved for a loan:
If you are planning to take a mortgage, pre-approval before scanning the market gives you a clear understanding of your borrowing capacity.
3. Consider location
• Location, location (and did I mention) location:
Almost anybody interested in purchasing property heard of this already very old statement. And it will never lose it's relevance because the most beautiful house in a dodgy environment is not worth much. But an "investor's dream" or "fixer upper" (meaning a house that needs significant investment) in a prime location can always become a gem.
• Neighbourhood:
Assess the quality of schools, public transport, amenities, parks and recreational spaces, shopping opportunities and safety in the area.
• Future developments:
Investigate upcoming infrastructure projects or zoning changes that could impact property value. The nicest house in a prime spot with stunning views will lose the majority of its value if a 10-storey house will be build in front of it obstructing the view.
4. Research the market
• Evaluate local trends:
Research property values, rental yields, and future growth potential in the areas you are interested in.
• Compare different properties:
Look at similar properties in the market to ensure you’re getting the best value for money.
5. Understand legalities
• Verify ownership and check permits and approvals:
Ensure the seller has clear ownership of the property and there are no disputes or encumbrances. Confirm that all construction and modifications comply with local regulations.
6. Inspect the property
• Physical inspection:
Check the property’s condition, including structural integrity, plumbing, electrical systems, security systems and roofing.
• Professional assessment:
Hire a qualified inspector to uncover hidden issues that may require costly repairs.
7. Offer the appropriate price and secure financing
• Conduct Due Diligence and be prepared to walk away:
Use market data and inspection results to justify your offer. Don’t let emotions override your budget or judgment. In case it doesn't feel right, you need to consider to walk away from that specific property. Another one will come around.
• Use a bond originator to secure your finances:
Compare interest rates, repayment terms, and additional fees among lenders. Familiarize yourself with variable-rate options to select the best fit for your financial situation.
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