The 'Great Australian Dream' of home-ownership remains as one of the all-time financial goals for almost everyone.
Your approach to buying a property will be drastically different depending on your overall purpose in wanting to purchase.
If you're just looking to get your foot in the property door, the ultimate goal is affordability.
Think of the old saying, 'buy the worst house in the best street.'
You can't change the location, but you can upgrade the house.
Are you buying to live in yourself or as an investment?
This question holds the key to everything including location, size, layout, condition, structural materials, facilities and more.
If you just want to get your foot in the door, focus on affordability.
Widen your search. The inner suburbs might be the ultimate goal, but is it realistic right now?
Consider the location.
A very relevant question whether you're planning to live in or lease. Or maybe you'll live in it for a few years, then rent it out. If this is part of the overall plan, ensure you're in a location you'd be happy to live in and that the same area is also in good rental demand attracting good quality tenants.
A smaller house that you can extend later on down the track may be a good option.
Look past the first impression.
We all have a mental image in our heads of what our first home will look like. Provided you're willing to roll your sleeves up and do some of the tough work, you'll be able to create a home that you are proud of whilst saving money too. This comes even easier if you have some understanding of building and construction. If this is you, then you're able to open up your search to homes in need of more structural attention rather than just cosmetic.
Start focusing on the following:
A history of regular savings - Regular savings in your bank account and a solid track record of employment will make it easier for you to get a home loan. There are minimum requirements to get a loan. Talk to a trusted mortgage broker about your options.
Pre-approval for a loan - Compare a few different loans before you decide. Ask your lender for a key facts sheet on each home loan so you can compare more easily. Once you choose the loan the suits you and have been pre-approved, you'll know what the repayments will be and how much you can afford to spend on a property. Then you can start looking seriously.
A substantial Deposit - When you're saving for a home the bigger deposit the better. A deposit of 20% of the purchase price plus enough to cover costs is ideal. The bigger your deposit, the lower your loan to value ratio (LVR).
Some additional savings - Your savings will act as a buffer if interest rates rise and your repayments increase. Alternatively choose a loan that allows extra repayments so you can build a buffer early on and redraw if you need it.