5 things to consider before Buying your first Home

5 things to consider before Buying your first Home

5 things to consider before Buying your first Home is in collaboration with LoanDolphin.

When I moved to Sydney from the UK in 2007, I was so surprised at the number of people who rented rather than bought a home there. It just wasn’t what I was used to. Very quickly it became apparent that the Sydney housing market is incredibly difficult for many young professionals and families to buy into and pricing are going up all the time.

We rented there for 5 years before we felt like we were in a strong enough financial position to purchase our first home.

5 things to consider before Buying your first Home - lovefrommim.com LoanDolphin Home Loans Finding the right home loan Finding the right mortgage How to find the right home loan First time buyers home loan

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I was 7 month’s pregnant when we moved in to our cosy 2 bedroom house in the Inner West – and it was lucky we moved in then because I had the baby early just a few weeks later!

Previously, I’d bought houses on my own, in a buyers’ market and when my income was higher but this time around we had to make bigger considerations as joint buyers starting a family. I thought I’d share from my own experience some things for you to consider before buying your first home:

1.  Work out your budget

Rather than simply finding out the amount a bank may lend you, work out what you can actually afford. The last thing you want is to move into the house of your dreams only to find you can no longer afford to ever leave it.

We made a list of all of our outgoings from what the home loan repayments would be, all the way down to my husbands’ daily coffee purchase.

Looking at the list of outgoings, we could see if there were any areas we could cut back on spending in order to free up some extra funds for the new home.

2.  Get the right advice

You might be tempted to only apply to your own bank, and that might end up being the right choice, but spend a bit of time researching to find out where the best rates for you are.

As a first-time buyer, I found this quite daunting. I had no idea what was even considered a ‘good’ rate and apart from the big name banks, I didn’t know who else to contact for the right advice.

I’ve recently discovered LoanDolphin, a marketplace where banks and brokers compete to win your home loan with their best offers tailored to you. I found the concept so innovative as when it comes to securing a home loan, it is often the borrower at the mercy of the bank, not the other way around! LoanDolphin offer a free, no obligation service and you can find out more about it by visiting their website here.

I talked to the guys at LoanDolphin about how they work to get their customers the best deal possible on their home loan:

“Recently a customer came to our website and he had a pre-approval from one of the major banks and a 20% deposit for an off-the-plan purchase. The bank valuation came back lower than the property sale price so he was hit with a $12k Lenders Mortgage Insurance bill. He heard about LoanDolphin from a friend and came to our website and within 48hrs he had multiple offers from experienced brokers and bank lenders who could connect him with the right bank which used the sale price instead of valuation and he instantly saved $12k just by getting the right advice. All banks are different so choosing the right one for you is a very important step but traditionally it took a lot of time and effort, that’s why we created LoanDolphin.”

3.  Save Save Save

If I could turn back time, I would have started saving money from a much younger age.

At the point you do decide to look for a new home, start saving what you can from that point, if you haven’t already. The bigger the deposit you put down on a new home, the lower the home loan needed and the lower your monthly repayments will be.

4.  Reduce your debts

To put yourself in the best financial position possible, try and pay off any outstanding debts you have. I had old store cards still in my name that I hadn’t spent on in years so I contacted those companies to close the accounts.

Pay off as many balances as possible and reduce your debts and outgoings.

5.  Consider the hidden costs

As well as the home loan payments, buying a house comes with extra costs that you might not have considered.

You’ll need to pay for searches, legal fees, insurance, stamp duty and rates so bear these costs in mind when you’re working out your upfront costs and your monthly payments after you’ve bought the house.

It’s also worth considering if other outgoings will go up or down when you’ve moved. Will you be travelling further to work each day? Will your car insurance go up or down when you change postcodes?

These are just some of the things you might want to consider before buying your first home. Buying a house, especially your first family home, is such an exciting milestone and being as prepared as possible will set you and your family up for a happy future.

Do you have any tips to consider when buying your first home?

Disclosure: I am not qualified to provide financial advice, these are simply my personal tips from my own experience.

5 things to consider before Buying your first Home - lovefrommim.com LoanDolphin Home Loans Finding the right home loan Finding the right mortgage How to find the right home loan First time buyers home loan

Image Source: Pixabay

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  1. peter dawson
    9th August 2016 / 10:24 am

    hope you are getting brtter and on the road to recovery one day at a time all the best

    • 9th August 2016 / 10:35 am

      Thanks so much Peter – I’m feeling brilliant at the moment and looking forward to the future :)

  2. 9th August 2016 / 12:19 pm

    Thanks for the good read. I still have no idea if I should buy a house now or 2 years down the road. But thanks for the tips. I now have something to think about.

    • 9th August 2016 / 12:20 pm

      Thanks Jacq – I know what you mean, it’s such a big commitment. Exciting though :)

  3. 12th August 2016 / 3:39 pm

    So good to have the experience from someone else. I don’t know when I will be able to buy in London as the market is crazy but I will have that in mind! #The List

    • 12th August 2016 / 5:34 pm

      I think London and Sydney are so similar – the prices are just crazy! x

  4. 12th August 2016 / 5:15 pm

    Really good tips. Especially reduce your debt. It is easy to get carried away and ending up to your debt because you want the perfect house #thelist

    • 12th August 2016 / 5:32 pm

      Oh definitely – I’ve made that mistake in the past and never again :) x

    • 13th August 2016 / 12:49 pm

      Thank you! I was the same first time too! x

  5. 14th August 2016 / 6:25 am

    This is ringing so true with me right now, we had our mortgage offer yesterday for our first house, I am so excited to finally own a house after renting for so long. #TheList x

    • 14th August 2016 / 11:55 am

      Oh that’s wonderful – congrats! x

    • 18th August 2016 / 8:06 am

      Thanks lovely x

  6. 18th August 2016 / 5:56 am

    Great list – Number 5 is a big one for me and something most people forget until that big bill from the solicitor’s arrives. #TheList

    • 18th August 2016 / 8:06 am

      So true the costs can really rack up aside from the home loan

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