First-time buyer 7 do's and don'ts

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Considering a property investment? Before you begin skimming the online listings and contacting real estate agents, have a look at our expert list of do’s and don’ts, designed to help you avoid making the rookie mistakes that send many first-time investors off track.
1. Don’t DIY – unless you have the skills
Investors often seek out cheap properties that they can fix up to boost the home’s value, but you shouldn’t embark on major renovations yourself if you don’t have the know-how or experience. Map out a renovation budget and as a rule of thumb, add 10-15% to your final cost projection to allow for unexpected or additional expenses.
2. Do your research
“There’s a whole raft of things you should be looking at, but very few investors undertake the actual due diligence on what it’s going to cost to hold a property,” says Fiona Herbert, an accredited mortgage consultant with Leap Frog Loansprocess. Speak to an expert if necessary so you can make sure you’re going in with both eyes wide open.
3. Don’t count on low interest rates
As the last few years have demonstrated, interest rates can flip on a dime – and you have no control over it. If a stable mortgage repayment to you is important for peace of mind, then consider a fixed loan product. Otherwise, make sure you have strategies in place to deal with higher interest rates if and when they do increase.
4. Do pay your bills on time
This means paying your credit cards on time and avoid overdrawing savings accounts. If you don’t have your finances and bills under control, it can be difficult to demonstrate a responsible attitude to money management, and “lenders are less likely to loan money to someone whose accounts are ‘irregular’,” says Herbert. “I recommend people ensure their account conduct is ‘clean’ for at least three months prior to lending, and preferably six months, as lenders can and do ask for savings statements for this period for first-time buyers.”
5. Don’t be shortsighted
Remember that buying property is an investment, so you’ll need to look after your property in order to attract and maintain good tenants. To make a bigger profit at the end, you must be willing to spend some money along the way.
6. Do – engage a good solicitor
Choose someone who has invested in property themselves, advises Jo Chivers, director of Property Bloom. “This is important for all of the people you surround yourself with, as the more property transactions they have handled, the more experienced they’ll be,” she says. “This may be your first investment but hopefully it will lead to many more property purchases for you – so the time you take now to set up your team will be rewarded.”
7. Don’t let your emotions cloud your judgment
The lead-up process to choosing that first property can be emotional, but you “must take the emotion out of it,” says Herbert. “So many people buy a property because their friend told them about it, because they liked the marketing, or because it’s in the next suburb and they drive past it every day. Go out and do some hard yards.”
7. Do ask the important questions
“Property investing is not gambling money away; it’s a significant business decision,” says Herbert. “So make sure you ask yourself: how much money do I need? What’s the return going to be? Is this the best place for my money?”

Whether you are looking to buy your first home, move home, refinance, or invest in property, a mortgage broker can help. Access loans from all the major lenders, get help with paperwork – plus there is no charge for this service. Get help from a local mortgage broker

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