What You Need to Know about Buying a Home as a Couple

Are you now considering buying your first home as a couple? If yes, then this may be one of your big milestones in life! Sure it can be very exciting, but it is important to remember that it can also come with lots of stress and hurdles that you may have not expected. These may include arguments, heated conversations, or any other conflicts that can occur because of disagreements, differences in interests, and even pride. With this, you will need to be ready to compromise and anticipate the worst that could happen like unexpectedly losing your job or a change in your priorities or financial situation.

And to help you ease your house hunting (as a couple) we listed down some of the steps that you need to do in order to run things as smoothly as possible:

• SET A BUDGET AND GET PRE-APPROVED FOR A LOAN

This is definitely the first step you need to take before looking for your first house. How much have you saved so far? What is your target budget? Besides this, you also need to take into consideration the amount of money you can borrow from the bank. What are the conditions? Are you qualified to get a loan?

Additionally, you also need to be conservative and realistic with your answers. Ensure that the budget you will come up with is enough for you to still enjoy the same lifestyle you have but without putting too much mortgage pressure on your shoulders and on your relationship as a couple, and that it will allow you to be a stronger candidate in having to get pre-approved for a home loan that fits your expectations.

It is also important to consider the hidden costs that go along with the purchase of a home, such as the processing fees, insurance, etc. If you want, you can always seek professional advice from a financial advisor to make sure your budget will be as comprehensive and accurate as possible.

• LIST DOWN WHAT YOU WANT AND HAVE AN AGREEMENT WITH EACH OTHER

Now that you know what your budget is, the fun part of your house hunting begins, which is to visualize and list down the things you want to have in your first home together and agree on what exactly you are looking for.

You may consider the following when doing this process:

• the area or suburb that you find yourselves happy to be in
• distance from your work
• the number of rooms (bedroom, bathroom, etc.)
• the condition of the house you want (renovated or original)
• the size of the house

Once you have the ideas of what you want, it is now time for the both of you to list down all of your “must-haves” and “nice-to-haves” and create a list of any potential deal breakers. For instance, the location of the house shouldn’t be too far from the bus stop or the market.

Next, be ready to compare your lists and compromise. Figure out which are mandatory and what may need to be sacrificed from each of your respective wish lists. However, if you still find it hard to choose which should be prioritized, you can also ask for a real estate agent’s help to act as your mediator and give you a list of key features that should be included in a house. It would also be better to visit the house of your dreams in order to determine what it really is that you are looking for.

• BE EMOTIONALLY PREPARED DURING YOUR HOUSE HUNTING

As mentioned earlier, house hunting can also be stressful and tedious. You will have a lot of competitors and you may even have a hard time finding the right house, so make sure that you are emotionally prepared and have a precise plan that you can stick to.

What you can do is to set up alerts on real estate websites and apps using the filters that meet your criteria. By doing this, you will be able to save time and energy in narrowing down your options and, at the same time, it will help you focus on looking for a house that has most, if not all, of your “must-haves”. Nevertheless, remember to strictly pay attention to your deal breakers no matter how attractive the house might seem.

When you inspect a prospective house, don’t also forget to take down notes, and write down the pros and cons that you find in it. Make comparisons between all the houses that you inspect and be more objective rather than focusing on your preferred house only.

• SECURE YOUR DREAM HOME BY MAKING THE RIGHT OFFER

Finally, your dream home is almost at your fingertips. The next step is to make the right offer and you can do this by determining first whether you will be buying by private treaty sale or at an auction. If the former, it is crucial that you assess the market value of the property and how much you are willing to offer. Depending on the competition and your budget, you might want to try to seal the deal and make your best offer right away so that there will be less risk of losing your dream home to another buyer.

On the other hand, if you decide to buy at auction, you will have to set an absolute limit and stick to your budget. Another trick is to make sure you review your wishlist as well as every detail of the house first before the auction, so you can remain calm and neutral on the day itself. Also prepare a bidding strategy for yourself, sitting and letting other buyers dictate the auction is no strategy at all. Prepare also your finances and ensure that they are in order, especially the deposit, as soon as you win the bidding battle. 

• THINK ABOUT THE FUTURE AND PREPARE FOR THE WORST OF IT

It’s not that you believe that you and your partner will eventually separate or that you will be incapable of paying for your home, but it’s about getting ready for the worst and protecting your asset. Some of the things that you need to keep in mind are the possibilities of unemployment, separation, illness, or any instances where you might be unable to pay your mortgage back, like death.

Given these reasons, some of the most important things that you can do are obtain all the right insurances and put everything into writing or an agreement in case of a separation. For this, make sure that you seek professional advice on what to detail in your agreement regarding your property’s co-ownership. You can also always secure a financial emergency funds for any unforeseen circumstances. If possible, save up at least six months of mortgage repayments, so you will be confident enough to find a solution in case an issue arises.

At Reval we are here to help guide buyers through the journey of becoming a property owner so if we can offer any assistance please have a chat with one of our agents.