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Introduction
Legal and Negotiation Processes
Preparation and Planning
Settlement and Post-Purchase
The Market and Compliance
Viewing and Inspecting Properties

01.
 
How To Use The Step Guides
02.
 
Buyer Introduction
03.
 
Welcome to Your First Home Journey
04.
 
Your Current Scenario
05.
 
Understanding Real Estate Market Dynamics and Influences
06.
 
Assessing the Benefits of Owning vs. Renting
07.
 
Assessing Your Readiness and Financial Planning for Homeownership
08.
 
Establishing a Budget for Property Purchase

09.
 
How First-Home Buyers Use the Bank of Mum and Dad in NZ
10.
 
Deciding to Work With A Mortgage or Financial Adviser
11.
 
Deciding on Whether to Proceed with Home Buying
12.
 
Analysing Financial Capacity for a Mortgage in New Zealand
13.
 
Getting Pre-Approved for a Mortgage
14.
 
Proceeding As a Cash Buyer
15.
 
Consider Utilising a Home Buying Service
16.
 
Attending Property Seminars and Workshops
17.
 
Exploring Various Mortgage Options in New Zealand
18.
 
Property Sale Types in New Zealand
19.
 
Anti Money Laundering Rules and Regulations
20.
 
Determining Long-Term Goals and Future Plans for Property Buying
21.
 
Costs Associated with Buying a Property
22.
 
Creating a List of Must-Haves and Nice-to-Haves
23.
 
Potential Purchasing Partners for Property Buying
24.
 
Researching the Housing Market in Your Desired Area
25.
 
Avoiding Pricing Pitfalls: A Guide to Transparency in New Zealand’s Property Market
26.
 
Location and Commuting
27.
 
Understanding Property Taxes in New Zealand
28.
 
How to Compare The Values of Similar Properties
29.
 
Exploring Property Listings and Conducting Online Research for Buying Property
30.
 
Interacting with Real Estate Agents
31.
 
Arranging Private Viewings of Properties
32.
 
Arranging Professional Property Inspections
33.
 
Guide to Attending Open Homes and Viewing Properties
34.
 
Seeking Comprehensive Legal Advice Before Making an Offer
35.
 
Choosing the Right Conveyancing Lawyer when Buying Property
36.
 
Understanding Legal Obligations and Rights as a Buyer
37.
 
Considering Community Amenities and Infrastructure
38.
 
Conditional Offers Versus Unconditional Offers
39.
 
Formulating an Offer Strategy
40.
 
Buying a Property at Auction
41.
 
Auction Bidding Services: Expert Representation for Your Property Purchase
42.
 
Buyer First Mover Advantage Offer Strategy
43.
 
Engaging in Negotiation of Purchase Terms
44.
 
Ensuring Compliance with Agreement Conditions When Buying Property
45.
 
Discussing Agreement Details with Your Legal Advisor
46.
 
Undertaking a Geotechnical Report
47.
 
Reviewing Property Inspection Reports for Potential Issues
48.
 
Requesting and Analysing a LIM Report
49.
 
Requesting and Analysing a PIM Report
50.
 
Things to Do During Due Diligence Period to Prepare for Move
51.
 
Preparing the Property: Painting, Staining, and Minor Interior Updates Before Moving In
52.
 
Advantages and Disadvantages of Using a Moving Company
53.
 
Organising Home and Contents Insurance
54.
 
Settlement Day Procedures
55.
 
How to Deal With Settlement Delays in Property Transactions
56.
 
Planning Interior Layout and Design
57.
 
Settling In and Post Purchase Steps
58.
 
Purchasing Necessary Furniture and Appliances
59.
 
Tools and Services To Help Manage Your Property & Finances Post Purchase
60.
 
Re-evaluating Your Budget Three Months Post-Property Settlement

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Buy / Step 8 of 60

Establishing a Budget for Property Purchase

Your home-buying budget: take a closer look at what to consider

Buying a home is one of the most significant financial decisions you will make in life. As with any big decision, you must have the right tools to help you make the best choice. A budget is one of the most powerful tools in your financial shed. A clear budget can help you set your goals and stay on track to achieve them. Here's an expert guide to setting up your home-buying budget.

Thorough preparation leads to better outcomes – start planning today for tomorrow’s dream home!

Homeownership should align with your broader financial goals. Whether it's saving for retirement, investing in education or planning family growth, consider how these objectives fit into your overall financial plan.

Most importantly, seek invaluable advice from financial advisors or mortgage brokers. These experts offer personalized guidance tailored to the New Zealand property landscape and can help you structure a budget that suits both your current financial standpoint and future aspirations.

Mortgage Advisers will traditionally not only work out if you can afford to finance a home at the current rates, but also at the higher rates of 7-9% interest under their stress testing. They must act within your best interests, and must explain why they have made the recommendations they have.

Then first step is to see where you stand right now - assess your current financial situation. This involves reviewing your income, savings, expenditures and existing debts. These figures will build a foundation for how much you can afford to spend on a property without overextending yourself financially.

Having them on hand is also necessary for the next step.

Securing loan pre-approval from a bank or other financial institution is an essential part of the budgeting process. Pre-approval gives you a clear idea of how much the bank is willing to lend you based on your financial circumstances and credit history.

Pre-approval also puts you in a stronger position when making an offer on a house, as sellers will see you as a serious buyer. I

Having pre approval means you aren’t wasting time looking at homes that are outside of your budget, and spending money on offers/due diligence when you won’t get finance approved as a condition.

It is vital to account for additional costs beyond the purchase price of your home. These may include legal fees, building inspection costs, loan application fees, insurance premiums, moving costs and any immediate home improvement costs. Do not overlook these when creating your budget.

In New Zealand, buyers typically provide a deposit of at least 20% of the property's purchase price.

There are options for those with smaller deposits through various government schemes and lending criteria that might allow for less - research what's available to you as they may have a big impact on your budget.

Owning a home comes with ongoing costs that must be considered when establishing your budget. Rates, insurance premiums, maintenance costs and body corporate fees (if purchasing an apartment or townhouse) are recurring expenses that will impact long-term affordability.

With all this information you can determine your price range. Take the maximum loan amount you qualify for plus any savings intended for the deposit, then minus additional upfront and ongoing costs associated with purchasing and owning a home.

Life is unpredictable and it is always wise to include an emergency buffer within your budget. This will allow a little extra wiggle room for unexpected expenses or changes in circumstances without jeopardising your homeownership dreams.

Your lifestyle should not suffer because you chose to buy a home. Work your daily living expenses into your budget, allowing for leisure activities. Striking a balance is key to enjoying life while settling into your new home.


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