Five common first home buyer mistakes to avoid

Buying your first property can be incredibly daunting. It's arguably the biggest financial investment you will make in your life and with that comes many things to consider, including a minefield of potential mistakes that can be made.

Here are five common mistakes first home buyers make that you should avoid.

1. Not doing your research

It's easy to get overwhelmed when buying a property for the first time. One way to help mitigate the risks involved with such a large financial purchase is to do your research.

Firstly, you want to know exactly what your finances will allow, what you are entitled to borrow from the bank and the different mortgage options that are available to you.

It's also worth researching the areas that you're buying in. Find out what similar properties are selling for in the suburb you're interested in and educate yourself about the kind of lifestyle and amenities on offer, such as the quality of schools, transport options, shopping centres, entertainment precincts and any upcoming zoning plans that may affect you.

You may also want to consider hiring a buyer's agent to help with your first property purchase. They are experts in the field and can do all the research for you to ensure you are in the best possible position to buy.

2. Making an impulse decision

It's worth taking your time when buying property. It can be quite easy to feel pressured to make a quick decision when you're going through the process, but it's in your best interest to take your time and not make any impulse decisions that you may come to regret.

Searching for the right property can feel like a long arduous process, but it's better that your search takes a couple of months longer than you would have liked than to make an impulse decision and settle too soon for something that doesn't quite match the criteria you're searching for.

Really think about what it is that you're looking for. Work out what your non-negotiables are and what you'd be willing to compromise on, and above all remember to be patient with the process.

3. Borrowing beyond your budget

Many first home buyers make the mistake of overextending themselves financially with their first property purchase. Your first home should be an enjoyable experience, not one that leaves you constantly worried about whether or not you can meet your repayments.

What a bank is willing to lend you and what you can realistically afford to own given your lifestyle may be two different things. Look at the big picture and don't make the mistake of buying a property that will leave you feeling financially insecure. You don't want to end up resenting your decision.

Establish your budget up front and be sure to stick to it.

4. Underestimating additional costs

Many first home buyers fail to adequately prepare for all the costs associated with buying a house. There are many more costs to consider than just your deposit.

For example, there's things like transfer duty, rates, building inspections, loan application fees, lenders insurance, moving costs and many other hidden extras that you'll need to factor in when budgeting for your property.

Be thorough and ensure your budget and financial plan caters for the entire spectrum of costs involved with a property purchase, not just the sale price.

5. Not thoroughly reading the contract

The Joint Form of General Conditions contract that you will sign when finalising the purchase of a property is a legally binding contract that you will be required by law to uphold once signing.

Before signing the contract be sure to read the entire document and make sure you understand all of the terms and conditions of the sale, including your obligations, responsibilities and any associated costs.

It's a good idea to sit down with the agent who is arranging the sale and read through it with them. This will also give you the opportunity to add clauses into the contract if you'd like anything extra addressed or acknowledged.

There is no such thing as a 'stupid' question when it comes to finalising a property purchase, so be sure to take your time and ask as many questions as you need, so that when you sign on that dotted line you feel confident and informed about everything it entails.

Want more information on the buying process? Make sure to check out our WA first home buyers guide.

Start searching for your first home today.