Buying your first home is an exciting milestone, but navigating Melbourne’s competitive property market can be challenging. To help you make informed decisions and secure your dream home, here are the top 10 tips for first-home buyers in Melbourne.
- Know Your Budget
Understanding your finances is the first step in buying your first home. Use an online home loan calculator to determine how much you can borrow and comfortably repay. Don’t forget to factor in additional costs such as stamp duty, legal fees, and inspections.
- Take Advantage of First Home Buyer Grants
The Victorian Government offers incentives such as the First Home Owner Grant (FHOG) and stamp duty concessions for eligible buyers. This can save you thousands of dollars. Research your eligibility and ensure you apply for these benefits early in the process.
- Get Pre-Approved for a Home Loan
A pre-approved home loan shows sellers that you’re serious and financially prepared. It also helps you focus on properties within your price range. Work with a mortgage broker or lender to secure your pre-approval before you start house hunting.
- Research Melbourne’s Suburbs
Melbourne is a diverse city with unique neighbourhoods. Research suburbs based on your lifestyle, work commute, amenities, and future growth potential. Popular areas for first-home buyers include Werribee, Sunshine, Cranbourne, and Reservoir.
- Prioritise Location Over Features
While modern kitchens and extra bedrooms are appealing, the location of your first home will have the greatest long-term value. A smaller property in a high-growth suburb can be a smarter investment than a larger home in a less desirable area.
- Save on Lender’s Mortgage Insurance (LMI)
If you’re buying your first home with less than a 20% deposit, you may need to pay Lender’s Mortgage Insurance (LMI). However, some lenders offer first-home buyer discounts or special programmes to help you avoid or reduce LMI costs. Investigate these options, such as using a guarantor or participating in the First Home Loan Deposit Scheme (FHLDS), which allows eligible buyers to purchase with as little as a 5% deposit without paying LMI.
- Inspect Properties Thoroughly
Don’t let emotions cloud your judgement. Attend multiple open inspections to compare properties. Look beyond cosmetic features and focus on structural integrity, layout, and potential issues like dampness or pests.
- Working with a Buyers Advocate
A buyers advocate can simplify your property search, provide access to off-market listings, and negotiate on your behalf. They’re especially valuable in Melbourne’s competitive market, helping you avoid common pitfalls and secure the best deal.
- Understanding the Contract of Sale
The legalities of buying a home can be complex. Have a conveyancer or solicitor review the contract of sale to identify any potential risks or unfavourable terms. They’ll also assist with the settlement process.
- Be Prepared for Auctions
Melbourne is known for its auction-driven property market. Attend a few auctions as a spectator to understand the process before bidding. Set a firm budget limit and stick to it to avoid overpaying in the heat of the moment.
Bonus Tip: Stay Patient and Persistent
The journey to buying your first home can be stressful, but persistence pays off. The right property is out there, and with careful planning, you’ll secure it at the right price.
Why Choose Melbourne for Your First Home?
Melbourne consistently ranks as one of the world’s most livable cities. From vibrant cultural hubs to family-friendly suburbs, the city offers something for everyone. With strong property growth and government incentives, now is an excellent time for first-home buyers to enter the market.
Warwick Brookes – Buyers Advocate
