With home loan interest rates at near record lows for the foreseeable future, now may appear to the perfect time to purchase that new home and land combination.

But property industry figures say while economic conditions may favour first homebuyers taking the plunge, they should do their homework.

“Your first step should always involve research,’’ says Petra Sprekos, general manager of realestateVIEW.com.au.

“Property data such as median prices, auction clearance rates, rental yields and vacancy rates help to ascertain demand and investment potential in a particular area, which is invaluable in making informed property decisions. Free data is available online at sites like propertydata.’’

Real Estate Institute of Victoria chief executive officer Enzo Raimondo says that, when inspecting a property, it is important to look “beyond the house itself”.

“It’s important to take into consideration other issues that could impact the price of the property in future – positively or negatively. This includes local traffic levels and noise, parking availability, developments planned for the area, and availability of public transport,” he says.

“It’s also worth checking local amenities like schools and shops. To save yourself any surprises, visit the property and the surrounding area at different times of day and observe what’s happening.’’

The REIV chief adds that pre-purchase property and pest inspections are a MUST before you exchange contracts or bid at auction. “These provide a written account of the state of the property, highlighting any problems such as building defects, and what it will cost to fix them,’’ he says. “This is important to know what you’re buying into, and can help you negotiate a fair price if immediate upgrades are required.’’

Mr Raimondo points out that a first homebuyer you should never go beyond his or her budget and financial means. “Ensure you save an adequate deposit – ideally more than 10 per cent – to avoid costly lender’s mortgage insurance,’’ he says. “Play it safe and consider unexpected events that may happen in the future which could affect your ability to repay your mortgage, such as job losses.’’

Mr Raimondo says those who are completely new to the property market should consider using a buyer’s agent.

The buyer’s agent can help his or her clients determine if the property is appropriate and affordable as well as negotiating a better price for it.

“They (buyer’s agents) represent those purchasing property and have extensive experience in buying the right property at the best possible price,” he says.
The REIV spokesman adds that on the day of the settlement buyers should do a thorough inspection of the property.

“Make sure all the fixtures and amenities are still included. Sometimes dishwashers and sheds – even if they a bolted in – will go missing before settlement. Make sure you get what you are paying for.’’

When it comes to new house and land, the Housing Industry Association Victorian executive director Gill King says potential buyers should contact those who have had homes constructed by a potential builder to gauge their experiences.

Mr King says buyers should take into account future changing circumstances including whether they can handle mortgage repayments and the costs of raising a growing family when incomes go from two to one.