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First-home building tips – Sunday Times 26/7/09

By Anthony Kinder, Managing Director, Wilson&Hart home builders

1. Remember, your first home is a stepping stone. Don't think of it as buying a home for the next 20 years, but consider if it will suit your living needs for the next five years. Buying and selling after only one or two years can be expensive.
   
   
2. Before you even start looking, understand your finances so you know what house or package price you can look for.
   
   Do this by talking to a mortgage broker, particularly one that deals with Keystart (WA Govt specialist lender for 1st homebuyers) as they will know all the incentives available.
   
   
3. Once you understand how much you can spend, start with the locations that fit your budget. Location is the most important part of buying property, whether it is a new house & land package or an established house.
   
   
4. Location also means close to amenities like the beach & parks, shops & medical facilities, work & public transport. Take all of these into account for your needs.
   
   
5. Check the scarcity value of the property. If it's new estate you are planning to buy a block surrounded by lots of vacant land that can be developed then the potential for capital growth is limited. Likewise, being 1 in a block of 100 apartments also means limited growth – or lots of competition when it comes time to sell.
   
   
6. Once you've found a block, building on it will be cheaper if the block is level and has sandy soil. Site works can be very expensive if you need to build retaining walls or extra building requirements.
   
   
7. Check that the block has titles available. That means that you can settle the block & start building as soon as you want. If it doesn't, ask who pays extra costs like rent, & increases in building costs if there is delays.
   
   
8. Do not overcapitalize – remember, it's a stepping stone. If you create a palace, you may not recoup all you've spent and in a lot of cases, good presentation counts for more than thousands spent in unseen areas.
   
   
9. Try to buy a house and land package that includes landscaping, fencing, floor coverings and window treatments. Don't be sucked in by packages with TV's, fridges or furniture -- you'll be still paying for those long after those items are on the scrap heap.
   
   
10. How much can you afford? What is the best location for what I can afford? Can I buy something I can improve the presentation of for not a lot of money? When it comes time to sell, will it be the sort of property that appeals to a large number of buyers.