How can you be sure your first property purchase is a good one? Experts say it all comes down to the three Ps.
Dipping your toe into the property market can seem daunting! Little wonder, given a home will generally be the most expensive purchase you’ve ever made and will likely be your largest asset.
According to National Property Buyers state manager Antony Bucello, first-home buyers have a better chance of making a purchase they’re happy with if they carefully consider the ‘three Ps’: position, property and price.
‘For most first-home buyers, price is the factor around which they have the least flexibility. First-home buyers typically work to a strict budget, determined by how much they can afford and how much the bank is willing to lend.
‘So for many first-home buyers, the other two Ps – position and property – are the ones they need to think about most, because this is where they have the most choice.’
Bucello says the position you choose will largely depend on your priorities, what you’re prepared to sacrifice and what’s non-negotiable.
‘You’re looking at a very different lifestyle in a property positioned within 10 km of the CBD compared to something that’s 25 km out.
‘In an inner-city position you’ve generally got access to public transport, cafes and strip shopping, but a first-home buyer budget usually means the price you can afford to pay will only get you a small apartment.
‘In an outer suburb, you may not have access to the same amenities, but you’ll be able to buy a three- or four-bedroom home with a garage on your own block of land and – if you’re planning a family – give children more room to run around.’
Bucello says history suggests established inner-city properties will rise in value more quickly over time than properties in outer areas, so if capital growth is important to you, consider sacrificing some of the items on your property wish list (such as parking or an outdoor area) in order to gain a position that will appreciate strongly.
‘There’s no right or wrong way to go. It’s about being honest about what you really value in a home.’
The property you choose means the type of dwelling and, again, there’s no right answer. Bucello says the key for first-home buyers is to be realistic about what they’ll be happy to live in.
‘Some people are determined to buy in a particular suburb and will start with a small one-bedroom apartment to get their foot in the door, with a view to upgrading in five years or so. Others want a unit or townhouse with a bit more space and another group again are determined to be in their own detached home.
‘If you’re after the latter, most first-home buyers will need to compromise on position to get the type of property they want.’
Achieving a workable compromise
Bucello says first-home buyers need to balance their priorities and personal circumstances across price, position and property until they arrive at a dwelling they can afford, are happy to live in and that’s located somewhere they at least like. ‘It’s not easy, but it’s possible, and it’s a first-home buyer’s best chance of success.’
‘If there’s one thing I’ve learnt as a buyer agent, it’s that every person is unique and has unique plans and priorities around home ownership. The key is to realistically consider your lifestyle and what’s going to make you happy. If you won’t cope having to drive 10 minutes every day for a good coffee, maybe it’s worth sacrificing that second bedroom?’
Let the three Ps – price, position and property – be your guide and your first home may be closer than you think!