The biggest mistakes first-home buyers can make

Buying your first home can be overwhelming. There is a never-ending list of tasks to be done and people to deal with, from mortgage-brokers and real estate agents to lawyers and sellers.

Unless you get good advice, there’s a high chance you’ll make a mistake, and when you’re dealing with your life-savings and a sizeable amount of money from the bank, even the simplest of errors can end up costing you a fortune.

Here are seven tips on how to avoid the most common mistakes:

1. Do your homework

While doing due diligence can seem time-consuming and exhausting, especially if you are looking at multiple properties, researching a property before making an offer is a must.

OneRoof provides an extensive amount of information on a property but it is essential you go deeper on those properties you hope to buy. The first deeper dive should be studying the LIM report, which agents will provide on request

The report provides information on property zoning, water supply, council valuation of the property and any rates levied for the year, building certificates and any relevant concerning information. The biggest mistake first home buyers can make at this stage is giving it a light once over or not asking what the information means.

It is important you pass the report to a lawyer, who will help you spot any red flags.

One area to clarify straight away is the property title - its ownership - especially if you are leaning towards buying an apartment or unit in a complex.

2. Organise a building inspection

It’s all very well being thorough during the open home, but nothing beats a professional eye to spot whether or not your dream home has any serious building issues, such as damp, dry rot, holes in the roof, electrical and plumbing issues, and structural deficiencies (would you be able to spot if a house needed re-piling?) Don’t be stingy - pay the on average $600 for a pre-purchase inspection.

Depending on the findings, the report will help you in your negotiations with the vendor, especially if repairs are needed. And when the inspection uncovers a shocker, you’ll be glad to move on to another property.

3. Don’t aim too high

Finding the perfect home that fits your budget could seem a mission impossible. Instead of aiming high, be realistic, says Barfoot & Thompson Hobsonville branch manager Mark van Lent.

“Consider property that might need some work but would add value to it later,” he says.

A cost-effective way to add the value to your home is to refresh the paintwork and beautify the front yard. “Plant some trees and get a landscape plan done. It will make you money while you sleep,” van Lent says.

Remember, your first home is not your last home, and you can upgrade later.

4. Neighbourhood watch

Van Lent said it is important to thoroughly check the neighbourhood you intend to buy in.

Loud party-lovers or trouble-makers next door can turn your life into a nightmare.

“Go knock on neighbours' door, chat to them and see how they like living there,” he says. “Buying a first home is a big decision so you want to be sure.”

Make sure to talk to more than one neighbour to form a balanced opinion.

5. Scope out future developments.

Read up on the suburb and investigate council plans to find out what’s earmarked for the area.

A planned new apartment block could spoil your view, and while a new supermarket could mean easy access to groceries and may eventually contribute making the area more desirable for future buyers, it could also bring with it increased traffic.

Other red flags could be consent for a waste disposal plant, a motorway flyover, a music venue, jail, all-night bar or a chemical-testing factory.

While having children might not be on the cards or an immediate priority, it’s important to think about childcare provisions in your suburb and the level and quality of schooling it offers. A new childcare centre in the area could add value, as could plans for sports facilties.

Being able to drop the kids off at daycare centre nearby, walk them to school or a sports centre, instead of commuting, is a big perk which would automatically increase the value of your home.

And if you end up renting or selling your property, these are the sorts of extras families looking to settle prioritise.

6. Traffic check

Make sure you check out your dream home and the streets around it at different times of the day to analyse the parking situation.

Even if the place you are looking at buying has a garage, you’ll want to know the chances of your friends, family and possibly potential flatmates getting a street park outside your home?

See how the traffic flows, check out the area for bottlenecks and reflect on how it would affect you.

7. Committing to the commute

Are you only considering one specific neighbourhood because it’s cheap?

Keep your options open and work how much money your commute will cost.

Conversely while living close to work is practical, you might be missing out on more suitable options in other neighbourhoods. What if your work moves offices, or you change a workplace in a few years? Would you be committed to the commute?

Check also the efficiency of public transport in the area: buses, trains and ferries, or maybe there’s an excellent Park and Ride system in place.