Get ahead of the house-buying competition

We don’t mean to alarm you, but you have a bunch of enemies now. You might have seen them already, skulking around the houses you’re thinking of buying. They’re thinking about what colour to paint your walls, planning outdoor furniture for your balcony. Some of them might even be texting real estate agents behind your back, promising to offer more.

We found a whopping one-in-five Australians plan to buy a home this year. That means pitting yourself against a whole lot of other buyers including experienced upgraders and even investors.

The good news is, three simple strategies can put you ahead of the pack – no professional wrestling moves required.

Get smart about building a deposit

Here’s an important tip: don’t aim to save ‘spare’ cash. We found 49% of Australians wait until regular bills have been paid to save whatever is left over. It’s an approach almost certainly doomed to fail.

Treat saving as a priority.

Set up an automatic transfer that allocates a fixed percentage of your pay packet into a dedicated savings account each pay day before you’ve had a chance to spend it on brunch. While you’re there, make sure you’ve got the right account. Sixteen per cent of people use everyday accounts to grow their savings, and that means earning little or no interest and possibly paying higher fees.

The money remaining in your everyday account is yours to spend. As long as you don’t dip into your savings, you’ll grow your deposit relatively painlessly.

Know market values when buying your first home

Your enemies competitors are doing their research. They know the market can be intense, so they’re entering the arena armed to the hilt with information, statistics and probably pie charts. To make sure you’re paying the right price, you’ve got to think competitively.

Talk to a wide range of agents. In a fluctuating market, they may be more willing to offer insights into sales prices and expectations. Check out lots of homes firsthand, not only to understand list prices but to see what kind of crowd they’re drawing. Go to auctions, even if you’re not intending to buy. Invest in suburb profiles and historical figures so you can see how the market is changing.

Most importantly, think like a winner. The better your equipment, the more likely you are to succeed.

Be ready to act fast

When you find the perfect first home to buy, be prepared to act. That means having as much as possible done ahead of time, including pre-approval on your loan.

Your Broker can help get all your home loan requirements together so you can turn things around quickly. A competitive offer that’s ready to go can be the difference between a property casual and a real contender.

While it may be stressful to be up against so many other buyers, buying your first home should be exciting, even momentous. Following these tips will set you apart from the other 20%. People will watch you sign your contracts and wonder if the other guys were even at the open inspections. Victory is sweet.

Contact your broker for more ideas on how you can beat the pack to the pick of properties.

This article is prepared based on general information. It does not take into account individual financial objectives or needs and is not financial product advice.

Source: ME Bank, February 2021