The economic effects of COVID-19 are hitting every industry, hard. That includes the property market. 

While this isn't ideal for homeowners and sellers, it presents first home buyers with a very rare opportunity.

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As housing prices are expected to drop seven per cent over the next year, this unprecedented time may indeed be the perfect chance for anyone fortunate enough to still uphold a stable job and has some savings behind them, to buy their first property.

But there are a few things you need to consider first.

Matt Spooner, Founder and Buyer's Agent at Buyer's Market Sydney, spoke to Mamamia about the exact questions you need to consider before you begin your first home hunt.

1. Are your finances in order?

Before you even begin looking for the house of your dreams, you need to get your finances sorted.

As Matt explains, most people will need to borrow money to purchase a property, so it's a good idea to speak to an expert. They will walk you through your financial position and answer any questions you have about entering the property market for the first time.

“In the early stages, I'd recommend meeting with a savvy mortgage broker, who can give you a good understanding of your financial position, and let you know exactly how much you can afford to make a purchase for,” he advises.

“This broker should be someone you can trust, and you feel comfortable working alongside. A good mortgage broker will always take the time to clearly explain concepts to you, and make sure you are comfortable before proceeding with any finance applications.”

2. Are you eligible for government loans?

The government has schemes to make home-owning possible so it is imperative you check whether you are eligible for them.

You can do this through speaking to a mortgage broker, who will do the work for you and suss out whether you're eligible to receive the First Home Owner Grant, or you can do the research yourself. 

“You should ask your mortgage broker to work with you to assist you in understanding the different types of loans available to First Home Buyers; the different Federal and State Government incentives available to First Home Buyers that you may qualify for; the different ways of providing security for a loan, for example deposits, guarantees and the like; and, the process of applying for 'Pre-Approval,'” Matt explains.

3. Do you know what you're looking for?

Once you have your finances in order and know how much you're willing to spend, it's time to look for the property. 

But before you get overwhelmed by choice, it helps to have an exact idea of what you want in mind.

“Searching for a property can be a very time-consuming and frustrating process, but also a very rewarding one. Generally, most people begin searching by looking online at either Domain or Realestate.com.au,” Matt says.

“These websites have useful tools that will allow you to match search results with the parameters you set. They will also provide you with dates and times for open homes and auctions, as well as the contact details for the real estate agents selling the properties.”

You can use these sites to understand or gauge the price that properties are going for at the given time, confirm what you're looking for and plan your inspection schedule for the weeks to come.

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4. Do you know how to deal with an agent?

After you have your inspection schedule in order, you need to consider your next steps if you find something you really want to buy. That includes knowing what questions to ask the real estate agent and how to come across as a serious and confident buyer.

Matt suggests you have a list of pre-prepared questions before any inspections, such as:

• How will this property be sold? Will it be auctioned, or will you be able to make an offer prior to the auction date?
• Why is this property being sold, and who currently lives here?
• What is the current interest level in the property?
• How many days has the property been on the market for?
• Is there anything you need to be specifically aware of with this property, for example: if it is a Strata Building, are there any planned special levies or fees that you may be liable for?

These questions are important to ask all real estate agents you see, because not only will they understand that you're seriously in the market for a purchase, but you will learn some valuable information about what you do or don't want throughout the process.

Once you've found the property you're interested in purchasing and worked out how you can buy it (either by private sale or auction), you'll need to complete your due diligence. Matt suggests that at this point, you engage with a solicitor to look over all the legalities.

"If you haven't already, you should now engage a solicitor or conveyancer to be your representative in this transaction. Your solicitor should be experienced, and should fill you with confidence with their eye for detail. The first step when finding a property you might be interested in purchasing is asking for a copy of the contract of sale, which you can then pass onto your solicitor for their review," he explains.

"They will look over this for you, and suggest amendments to the contract if necessary. At this stage, you should also look to order other reports, such as Strata, and Building and Pest reports, to make sure you aren't buying a property with any hidden secrets you might not see at first glance."

5. Are you confident in making an offer?

When it comes to making an offer on the property you want, you need to put all emotions aside and understand how much the property is really worth (not just what they're advertising) before offering anything. 

"When it comes time to actually negotiate on a property's purchase price, it's important to have completed the steps above, and to enter the negotiation phase with a professional, calm and emotionally detached attitude," Matt advises.

"Generally speaking, during this phase, you should be liaising with the selling agent to determine how much they believe the property will likely sell for, and then fact-checking this by looking at sales of comparable properties that have recently sold. Websites such as Domain or Realestate.com.au should come in handy here. You should also liaise with your mortgage broker during this phase to workshop how making a purchase at a particular price may affect your budget and cashflow, and how much deposit you may need to contribute."

And once you've done this, you should write to the agent and provide a formal offer, along with any specific conditions. But as Matt reiterates, you need to remember that the real estate agent has the seller's best interests at heart, so always do your thorough research first.

"It is important at this stage to remember, a real estate agent is a professional negotiator, who is obliged to represent the interests of the seller in the transaction, so always make sure you fact-check and complete your own due diligence when it comes to buying, or consider levelling the playing field by working with a buyer's agent," he says.

Which brings us to our next question.

6. Do you know who to outsource for professional advice?

While buying your first home can seem very exciting, there are a lot of things you need to seriously consider. And if that's something you're worried about, it might be a good idea to get some professional advice. 

"Buying a property for the first time is a complicated, time-consuming and often very stressful process. There are lots of moving parts to make a transaction happen," Matt says. 

"As such, it can be really beneficial for first home buyers to get assistance from a professional buyer's agent to guide them through the process of purchasing. They can assist you by holding your hand the whole way through the process, and often accessing properties that you may not be able to access yourself, known as 'off market' properties. 

"A buyer's agent can also help you by completing due diligence on your behalf, and giving a professional opinion as to a property's value. They really level the playing field for first home buyers, and can often save buyers many thousands of dollars through sound negotiation techniques and strategies," Matt explains.

Are you thinking about purchasing your own home? Let us know in the comments.

Feature image: Getty.