Monday, September 8, 2008

The A-Z Of First Home Ownership

With home ownership at our fingertips, I’ve chosen today as a time of reflection. A fun way to do this is with a A-Z list of the journey. Whew! Without giving anything else away, here it goes…

A – Agents. MAKE SURE you find yourself an agent that you really like. Our agent Brett rocked – he was good fun, and made me look forward to house-hunting a LOT!!

B – Broker. Mortgage broker, that is, and a good one at that. They make finance as easy as possible. Our mortgage broker, Leteisha, is very cool and never made me feel stupid, with all the dumb questions I asked along the way!! She knows stuff.

C – Council rates. Who knew it could be so expensive just to live in a suburb?? Once a year you pay the council a hefty amount, and it covers things like rubbish trucks, vandalism in the community, road works, and other random things that your suburb requires. So I can see the point of them, but they’re going to be a pain!!

D – Documents. For a while there, we were getting 2 – 3 packages of paperwork each week. Our hands grew tired of signing, our eyes grew tired of reading, and our brains grew tired of processing information. Be prepared!!

E – Elderly people. For some reason, some of the best, cheapest houses are over-55 villas. If you’re house-hunting on the internet, before falling in love with anything read up on it in the description, and make sure it’s not an over-55 villa. You’ll save yourself a lot of disappointment! (Unless you’re elderly yourself).

F – Finance approval. You need payslips, group certificates, bank statements and all kinds of other junk to get your finance approved. A huuuuge pain!!!

G – Grants. We qualified easily for the $7,000 First Home-Owners Grant, and after settlement we’re applying for a $2,000 REBA rebate. Any extra money helps, so do your research!

H – House hunting. Look at heaps of houses before you pick one. It’s fun, gives you a great idea of what you can get for your money, and it’s important to see the good, the bad and the ugly. Plus, you want to know that the house you put an offer on is definitely right for you!

I – Inspections. Lots of them. Keystart did a value inspection, someone else did another generic inspection, there was a white-ant inspection, my Dad did an inspection, and last week we did our final inspection. If there’s something wrong with the house, make sure it’s found BEFORE settlement – or it’s your problem to fix, and your bill to foot!!!

J – Junk. Don’t bring all your junk with you when you move. Moving is the very best opportunity to be ruthless. Don’t try and convince yourself that, just because you have to squeeze something into the top of your wardrobe in your current dwellings, you’ll certainly find a good place for it in the new home. You won’t. If it’s squeezed into the top of your wardrobe, you can obviously do without it.

K – Keystart. Their shared-equity scheme is the one and only reason we could afford to buy at all. They own 30% of the house, which means we’re only paying off the mortgage on 70% of it, until we can afford to buy more off them J

L – Look and Listen. Do your research. Check up on how various suburbs have been gaining/decreasing in value. Decide what you need in a house, and what would be nice. Listen to your friends, and their experiences (especially those that are 20+ years older than you!) The more knowledge you gain, the more you’re benefited in the long (and short) run.

M – Money. Don’t ever think that you have more than you do. Based on our earnings, Keystart would have allowed us to purchase a house up to $375,000 in value. The house we purchased, we got for $284,000 and I can tell you that we’re going to be scraping by some months. On top of mortgage payments, there are tons of other costs – insurance, rates, bills, maintenance & improvements to name a few. Then there’s the cost of plain ol’ living. So don’t take out a mortgage that’s going to ruin you!!

N – New. Not only will the house be new for you, but it’s possible you’ll be in a whole new community, with new people. Get involved, embrace it. I can’t wait to find my place in our new little neighbourhood!

O – Offer. Here’s my take on making an offer – you offer 5,000-10,000 less than the owners want. They counter your offer, asking for 5,000-10,000 more. You counter their offer, upping your original offer by about 3,000. They counter yours, lowering theirs about 3,000. This goes on for a while until someone makes that golden offer that everyone’s “happy” with. I’m quite sure that the agent just bounces the buyer and the seller off each other for a while. It’s a tricky game.

P – Parents. They know stuff, so listen to them – whether it’s about rising damp, money, first home ownership tips… they might sound like they’re worrying too much at times, but it’s probably for a good reason!!

Q – Questions. Ask lots and lots of questions. First home ownership is a huge deal – you don’t want to sign up if you’re even remotely uninformed!

R – Rising damp. It’s sneaky, and if it wasn’t for my Dad’s cleverness we could well have signed up for a place without a care in the world. Rising damp occurs when water gets into the walls. Tell-tale signs are bubbling paint, rusty doorframes and cracks. It looks like a small, easy-to-fix thing. $10,000 later, you might reconsider. Watch out. Dad picked up on it in one house I was keen on, and that ended that!!

S – Settlement Agent. They’re expensive but essential, unfortunately. They make the purchase legal, and they do all the hard work with rates enquiries and stuff. Our settlement agent is pretty good, but I wish I’d know our friend Mike does settlements, before I signed up for this agent!!

T – Time. It can take a while. We found our place at the end of June, made our offer in early July. With inspections, negotiations and finance approval to sort out, we just had to sit and wait. Finally, we get the keys this Wednesday, September 10. Patience is a virtue. You will most likely learn all about it when going for your first home!

U – Ugliness. Sometimes you have to accept ugliness in your first home. Like floral carpets, or bright green bench tops. Suck it up. If the house is fine other than the daggy, peeling wall paper, you’ve got yourself a great deal! You can always change the way it looks, so focus on functionality.

V – Vendors. They are the ones selling their house to you. You learn their names, you inherit the bits of junk they don’t want to take with them – yet you never actually meet face-to-face. Weird.

W – Walls. They’re more expensive to paint than I realized. That’s pretty much it.

X – Xcitement (sorry, X is such a pathetic letter to start a word with!) These are exciting times – once you can see over the pile of paperwork, once those keys are in your hand, things will start to get freakin’ exciting!!!! Enjoy yourself, and don’t lose sight of the fact that this is your VERY FIRST HOME!!!!!!!!!!!!!!!!!!!!!!

Y – Yonder. You’re going to live yonder if you’re anything like us and can’t afford to live where you grew up. The cheapest houses are typically not where your church, workplace, family & friends are – so be prepared to up your travel costs!!!

Z – Zoo. Do not convert your new home to a zoo, as you need lots of licenses, as well as 20 zillion times more space than your block can offer.


Topher-o-Rama said...

What was that bit about a zoo?? Does this mean no pets? I'm confused..![Sigh]

Klara J said...

Nope, I was being quite literal. We can have pets, many pets. But no converting our house into a fully-functioning, tourist-attracting zoo before I move in, y'hear??