If you are investing in real estate for the first time, chances are you’re about to buy your first home. What they don’t usually tell you is just how complicated a procedure it can become. Many people believe buying their first house is about saving a deposit and then paying a monthly mortgage bill. This is pretty far from the truth, unfortunately.
Buying a home is one of the most expensive things you’ll probably ever do. And the cost of buying the property goes far beyond the sale price. First of all, you need to save up for a deposit. This term doesn’t always mean that you’re reserving your right to buy a particular property. Any other investor could still swoop in. It is simply the amount that the mortgage lender expects you to put down before they give you the loan you need.
After a ten or twenty percent deposit, you may be feeling a little depleted funds-wise. But there are many more expenses to come. In some places, you need to pay tax on your purchase. This can be a bill of thousands that must be paid in full at the time of completion. Your property lawyer often requires this a little beforehand so he can post it on your behalf.
There will also be lots of fees to pay before your lender gives you the cash for the house. There are a huge variety of home loans out there, but each will require a fee being paid to cover administration and other costs. You may also need to pay any mortgage broker you use.
Your property lawyer will need a number of fees paid. Land searches, property registrations, taxes and conveyancing are just a few. Often the fees are bundled up into one charge. This too will usually need to be paid before completion of the sale.
If you purchase your property by auction, chances are you’ll have to pay the auction house or realtor a fee too. And then there’s the cost of travel to view the property and meet with the sellers, realtor, lawyers and bank. Next comes all the little things you may not yet have thought of.
When you move house, you have to terminate contracts for your previous property. This may result in termination fees. You’ll also have to settle all accounts for utilities and subscriptions prior to moving. Once you’ve paid for the removal van, you’ll need to ring around all the utility companies again to start new contracts at your new home. If your local authority charges taxes for homeowners, you’ll have to cover that on moving day too.
You might need new services like cable or telephones installed. Again, you will be charged. And then there’s the cost of any renovations or decorating that needs doing before moving in. The bills and costs will keep going up! Finally, you’re going to need to eat. Frozen and refrigerated food doesn’t tend to travel well, so restocking your fridge will also cost you a few pennies.
Moving home is expensive, and it’s stressful, especially if you are buying your first place. But the investment and freedom it offers will certainly be worth it all. Enjoy your new home!