Wondering about the steps to buy a home? This straightforward guide from an experienced buyers agent will get you started.

If you haven’t purchased one before or you haven’t done so for a while, you may be wondering the steps to buy a home. 

Unless you have a million dollars or more sitting in the bank or you don’t care where the home is and what it looks like, buying a home is time-consuming. However, the easiest way to get to the finish point is to start at the beginning and take it step by step. 

Here are the ten steps to buy a home:

Step 1: Determine your spending limit

Your income (and your partner’s, if you have one) will indicate how much you can afford to repay on a home loan. Obviously, the more you earn, the higher your monthly mortgage repayments can be. 

There are several online calculators which give you an idea of what the monthly costs of a home loan would be based on current interest rate levels. Remember to leave some ‘wriggle-room’ in your budget as interest rates could increase in the future, leading to higher repayments. 

Step 2: Organise your finances

The amount you can borrow will also depend on your current expenses and financial situation. 

Make a list of the money you spend each month. Are there areas where you could be cutting back? 

You also need to take control of your debts. The less you owe on a credit card or personal loan, the better. The bank will look at all your debts when you apply to borrow so it helps to know exactly what they are. 

It is ideal to have at least a year’s worth of financial records to share with your lender. If you’re hoping to buy a home, there is no time like the present to make organising your money a priority. 

Step 3: Save for a deposit

If you already own a home, you may have equity which can transfer to the next purchase as a deposit.

If you’re a first homebuyer wondering how to buy a home, you will need at least five-ten per cent as a downpayment. Yes, it feels like a lot! But if you make a plan and stick to it, you’ll get there. 

Lenders like to see proof that you can be responsible with money. If you have as little debt as possible and a lot of savings you’ll stand in good stead to be approved to borrow. 

Step 4: Get pre-approval

You will need a mortgage broker for this step. This professional will work with you to find the bank which will lend you money, with loan terms that suit your lifestyle. 

This will be the time to share all your paperwork and some financial records as well as proof of employment and your immigration status. 

Having pre-approval means the bank agrees to lend you money, so long as your circumstances don’t change too dramatically. Pre-approval is usually valid for a few months. 

Step 5: Start shopping

You have done a lot of groundwork and have probably been visiting open homes while saving your deposit but now’s the time to look seriously for a home. 

One way to make this experience much smoother is to recruit the services of a buyers agent who has excellent connections and will be able to speak with you about the type of home you’re after. 

Once they know what you’re looking for, your buyer’s agent can leverage their network to find properties before they hit the market or go to auction. 

Step 6: Get your pest and building inspection

Your buyers agent will give you insights about whether they think the property you have your eye on is a good investment. However, it makes sense to ask someone with professional qualifications to look for any hidden defects or pest colonies which may cost you money after you move in. 

Step 7: Make an offer or bid at auction

Ready to negotiate? Your buyers agent is your secret weapon and can work quickly with the seller’s real estate agent to ensure your offer is accepted.

A buyers agent can also bid at auction on your behalf, taking the stress out of this experience (and making sure you don’t get excited and overspend). 

Step 8: More paperwork!

When you agree to buy a property, it’s time to sign some contracts. Your buyers agent, real estate agent or mortgage broker may refer you to a legal professional known as a conveyancer so you can make sure everything is in order. 

Step 9: Wait for settlement

Settling on property and finalising the contracts usually takes a month or more. During this time you can shop for new furniture, revise your budget to make sure you can afford repayments (there’s no backing out now!) and book your removalists. 

Step 10: Move in!

Congratulations! You have the keys and you’re a homeowner. If you have chosen wisely, your investment will improve in value over time and you will have a wonderful home you love to live in. 

Need help to buy a home on the Northern Beaches? Contact an experienced buyers agent who can find your dream property sooner.