Purchasing your very first house is quite possibly one of the biggest decisions and financial investments you’ll ever make. So it’s imperative that the home you’re purchasing isn’t a money pit and will ultimately set you up for the future and turn a profit.
So how do you maximise your chances of making a profit from your first home?
Location, Location, Location
First and foremost, the position of the patch of dirt is crucial. Ideally try and keep clear of these possible deterrents ::
- Battle axe blocks,
- Crazy-busy main road frontage,
- Obstructing electricity power poles,
- Sites within close proximity to huge power lines (for loads of health reasons too), and
- Blocks with shitty access and parking.
You want the worst house in the best street
Don’t judge a book by its cover. With some elbow grease, a few working bees and a coat of paint often you can turn the ugly duckling into a swan. Purchasing with this rule of thumb gives you ample opportunity for improvement and to capture profits.
Do all the sums upfront
Before placing a written offer it’s crucial you’ve crunched the numbers including rates, insurances, body corporate (if applicable), renovations and new furniture. You don’t want to over-extend yourself on the purchase price and have to eat canned tuna for the next 12 months (trust us, we do this all too often).
A home with character capture hearts
Purchasing a house with aspects of character is a bonus and does assist with resale. Look for timber floors, detailed cornices and stained glass windows. All of this detail is costly to add later and hence highly sought after.
Don’t over capitalise
Discuss your renovation plans and forecasted costs with a few real estate agents (such as our mate Darren Piper) to gain a feel for how much the home would be worth once you’re done with it. It’s crucial you don’t get too excited and sink too much money into the home that can’t be later recouped. #rookiemistake
The more bedrooms the better
Kitchens, bathrooms and bedroom sizes and quantities sell homes. You know for yourself the difference in price between a one or two bedroom apartment or three or four bedroom home. There’s a significant jump in value.
Use this knowledge by trying (if possible) to add bedrooms to the floor plan without spending too much cash. Think about converting study areas, laundries or garages into bedrooms and using built in cupboards and carports to compensate.
Consider a mortgage broker
We’ve always had quite experiences with a number of different brokers we’ve used. Basically they know the ins-and-outs of what’s on the market in terms of interest rates and bank fees. It’s a great idea to at least consult with one and get a feel for if it’s right for you.
Maximise Government incentives
Often the Queensland Government (here in Australia) incentivises first homes though financial grants. The rates and conditions do change regularly so be sure to do your research and understand what’s offer.
Style with recycled secondhand furniture
Keep your thrifting eyes open and source bargains. There’s no point in decking out your first home in opulent, expensive furniture when you’re looking to move to something bigger and better in perhaps the next six to 12 months. So say yes to friends and family willing to end you a spare bed or computer desk and jazz them up with styling touches.
Think functionality and practicality
Based on experience, it’s important that there’s loads of natural light and that the initial floor plan works – or atleast has potential to flow with a few (non load bearing) walls removed.
We’ve also previously found adding value by decks and extensions difficult when the home doesn’t have a hallway or access to the backyard other than through a bedroom. This is a massive deterrent as no one really wants to walk though your bedroom to access the communal entertaining area.
To get your mind thinking about design and function, download our FREE 17 Traits of Functional Homes.
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So tell us DIYer, are you a first home buyer on the hunt?