Buying your first home

Buying a home is one of the most important decisions of your life because it combines your personal hopes and dreams with wanting what's best for you and your family. These tips will help you enjoy a trouble-free journey to your new home.

If you start shopping for homes without knowing how much you can spend, you will not only waste time looking at the wrong properties, but you may ultimately be disappointed at what you can actually afford.

So take a good look at your financial situation and speak with your bank manager to determine how much you can afford. This will minimise the fear of being rejected for a home loan when the opportunity arises.

Many mistakenly purchase expensive homes, and can barely afford the payments. Avoid becoming "house broke". Ideally, loan payments should be no higher than 35 per cent of your total monthly income. This way, you can comfortably pay your mortgage and care for other household expenses.

Make a wish list

Given your price range, start writing down the things you'd like in a house: number of bedrooms, garage, views etc. Prioritise each item as either a "must have" or "would like to have", so you can determine what is most important, and which items you are comfortable sacrificing. Try to be realistic! Decide on the type of property. Do you want a modern apartment or a house of character? What locations are you ready to consider?

Choose a real estate agent

Do you have the time, energy, sources of information, and market knowledge to find the right property? It is in your best interest to choose an experienced real estate agent who is ready to listen to and understand your needs. Having a skilled agent on your side can help you avoid making costly mistakes, especially if you are a first-time buyer. A real estate agent will:

• give you a wider choice by showing you a large selection of properties;

• explain all the procedures and expenses involved in buying a property;

• negotiate the right price;

• suggest a reputable notary;

• keep you informed as new properties come on the market.

Remember... a skilled and knowledgeable real estate agent will save you time and money.

The "red shoes" experience

Women will relate to this. Say, you need a new pair of red shoes. At the first shoe store, you find a fabulous pair of red shoes. You try them on. They fit perfectly. And carry the right price tag too. Do you buy them? Of course not! You go to every other store in Sliema, trying on red shoes until you are ready to drop from exhaustion. Then you return to the first store to buy those red shoes. Do not shop for a home this way.

When you find the perfect home, buy it.

House hunt!

Now comes the fun part. But don't expect to view 25 properties a day! Although it's physically possible to do so, your brain will be overloaded and you probably will not remember specific details of any of them.

An experienced estate agent will probably show you ten of the best properties on the market. If none of these meet your expectations, the agent will analyse your feedback and prepare a new list. When viewing properties:

• always take a digital camera;

• take notes about the pros and cons of every property that you see;

• pay attention to home surroundings. Are views guaranteed? Do you feel comfortable with the neighbourhood? What is next door?

• immediately after leaving, rate each home on a scale of one to 10;

• never focus on the problems. Focus on the possibilities.

View top choices a second time

After touring properties for a few days, you will probably instinctively know which one or two properties you'd like to buy. Avoid making snap decisions. Ask to see these properties again. You will see them with a different eye and will notice elements that were overlooked the first time round.

A key question to ask during your second visit is how long the house has been on the market. The amount of time will give you an idea of how flexible the owner is about the price. If the house has been on the market for a month, the owner isn't likely to be very flexible. If it has been on the market for a year, flexibility is definitely a consideration.

Noise is another big issue to consider. If you are serious about the property, make sure to drive by during the evening and on weekends.

In the euphoria of buying a property, practical issues can be missed. A big one is traffic. Specifically, what is the commute like between the house and your place of work? If you don't have a car, how far is the house from the village square, shops and bus stop?

A Final Word

Once you've found your dream property, it's time to make a serious offer. The estate agent will probably do all the negotiations for you. It's human nature to try and strike a deal, but if your offer is not accepted although it seems to be the correct price, consider buying it at the full asking price rather then risk losing the property altogether.

Get your home inspected by an experienced architect, who will impartially check its structural condition and verify all the necessary MEPA permits. After all, this will give you the peace of mind of knowing what condition the property is in. Remember, there will always be another property.

So even if you miss one due to your cautious approach, another one will be right round the corner.

Common mistakes

• Imagine the property vacant. Don't be swayed by beautiful furniture... it usually leaves with the owner!

• Make sure you have enough funds to finish and furnish the property, especially if it's still in shell form or unconverted state.

• Keep in mind the closing costs before you sign, including stamp duty and notary fees.

• Carefully consider your income level and living expenses. Take into account future considerations, such as getting married, having children, etc. Your dream home is certainly worth a sacrifice but don't mortgage your entire future for it.

• If it's not in writing, it doesn't exist. All promises and discussions are to be in writing. Don't make any assumptions or believe any assurances.

The biggest mistake of all

"We didn't buy. We were afraid of making a mistake." Don't let worries overwhelm your ambitions. If you have an opportunity, grab it! Remember... dreams move on if you wait too long!

kevin.cauchi@remax.com.mt

Mr Cauchi is a property consultant with Re/Max Gozo, specialising in residential sales and property management.