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Four ways to save

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Nila Sweeney
We all like to save money where we can, and there’s no better time to stretch your dollar further than when buying your very first home.
 
It’s likely to be the single biggest investment you’ve made in your lifetime to this point, says Colin Williams from www.humblesavers.com, and he’s not just talking in monetary terms. “It’s also a very emotional experience, with a mix of genuine excitement and fear,” he says.
 
So, he’s come up with four tips to help “bring some common sense to this big investment, and to put you in a strong position to buy a property that will be both a great home and a successful investment”.
 
1. Set a clear financial range
You’ll spend a lot of time online when buying your first property as there’s a lot to research to be done, but while you’re viewing the properties on offer, it’s important that you don’t fall in love with home that is priced beyond your means. It goes without saying that if you stick within your budget from the outset, you’ll pay less in ongoing mortgage repayments over the long term. “You also need to consider the total costs of buying and keeping the home in order, which means thinking past the mortgage repayments,” Williams says.
 
2. Avoid auctions
“A snap decision to buy can be the result of ‘deal fever’, which can often happen through sales pressure, particularly at auctions,” Williams says. “It’s all too easy to sign a deal very quickly because it feels emotionally right, at that particular time, rather than rationally thinking it through.” Avoid the possibility of over-paying or over-stepping your budget by avoiding bidding via auction in the first place. If a property is offered by auction and you really like it, there’s nothing stopping you from submitting an offer beforehand.
 
3. Focus on the location
If you’re trying to decide between a well-located property that needs work, and a better-quality property that is less centrally situated, location should always win, Williams says. “It’s important to understand that the value of a house is largely based on the location, as the actual house including the bricks and fittings lose value,” he advises. “Therefore, consider compromising on the actual house before the preferred location. You can always fix things about the house, but you can’t fix things about the suburb.”
 
4. Learn how to negotiate
“You may find yourself negotiating against some very sharp sales people. Your mortgage provider needs a deal and real estate sellers are known for their ability to sell just about anything. By contrast, most first homebuyers have had a fairly sheltered life when it comes to negotiating big investments,” Williams points out. Prepare yourself to negotiate however you can, buy reading books on how to negotiate, or finding a good friend or a family member to help you. “Most families have the proverbial ‘wheeler and dealer’,” he says. “There are also buyers agents available and they could be worth talking to, as negotiating is not easy – but it can pay huge dividends if you can do it well.” 

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