1. Know your limits
Before you even think of buying a new home, get your calculator out and conduct an honest appraisal of your current and likely future income. How much do you earn, save and spend on a monthly basis, and is your work/employment sufficiently stable to support your decision to commit to the biggest single purchase of your life? Approve yourself for a mortgage before you ask a bank to. Remember, the bank will own your home until your final mortgage payment. The only real issue for them is how much they will earn from lending you money.
2. Search smart
So, you have the financial wherewithal, your mortgage approval, and you’re sure you’re ready to buy? Okay then. Now look for the properties that are within your budget in your preferred location or within a reasonable radius of it. Do not conduct your property search solely on the basis of what appears to be most affordable if that purchase is going to end up costing you in terms of additional expenditure on travel and your quality of life. How close is your potential home to your work, family and friends and essential amenities such as schools, shops, and the local doctor. Do you want to live in your home or in your car?
3. Consult planning files
So, you’ve found what appears to be the ideal new-homes scheme for you. The show houses are attractive and the road that’s ready to view is pristine and lined with lime trees planted in a neat line along freshly-laid and mown grass verges. Before you step across the threshold and inhale that heady mix of fresh paint and newly-laid carpet, or clap eyes on the fully-fitted kitchen, stop and take a good look around you. There may be rolling fields or even a sea view. But will either of these be there forever? Don’t presume they will. Ask the selling agent or, better still, consult the planning files for the scheme itself and the area surrounding it. What development has been approved already and what is coming down the tracks under the terms of the current and draft local development plans?
4. Suss out the area
Now do a further recce of the scheme and its surrounding area by visiting it at different times of the day and night, and at different times of the week and at weekends. Does it still meet your expectations? What are the traffic levels like? Is there any evidence of antisocial behaviour? Put simply, is it somewhere in which you would like to settle down and potentially raise a family?
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5. Check what’s included
Still happy to proceed? Then it’s time to take a look at the house itself. You can presume that the show house you are walking through and “oohing” and “aahing” over represents the proverbial bells-and-whistles expression of what you’re interested in buying. Much like the most expensive, fully loaded version of the car that’s on display in your local motor dealership, this one has everything added on. But everything comes at a price. So be sure to interrogate the selling agent to find out what exactly is included in the cost of the new home that you intend to buy in terms of the kitchen, its appliances and their specification, the bathroom and its fittings, painting, flooring, tiling allowances, built-in storage, wardrobes and the garden. Taken together, all of the above will cost you thousands of euro if they’re not already part of the package, thousands of euro that you probably won’t have at your disposal once you draw down your mortgage.
6. Step inside
You can still afford to dream of course but don’t lose touch with reality. Don’t just walk through the show house and view your new home from the kerbside. Go inside the house you intend to buy, take in the views from every room and measure every space to see if the furniture you want, and all your other “stuff” will fit. Step outside now. Is the garden orientated to make the most of the sunlight? Do you have space to park one or two cars in the driveway, and if not, is there room to park easily and safely on the road outside for you, your neighbours and visitors? Is there a sufficient green space for children to play safely and within sight of the residents?
7. Be ready to commit
So, you’re happy you’ve found the right house in the right location and you’re ready to proceed. Or are you? Be sure you have your mortgage approval in place and a solicitor on board to fast-track the exchange of contracts. And should you be eligible, and intend to avail of it, you should also have your approval for the Government’s First-Home shared-equity scheme in place. With new homes still in short supply relative to demand, you need to show the selling agent, and more particularly the developer they’re representing, that you’re ready to buy. Do this by having your booking deposit – typically about €5,000 – at the ready. After that, be prepared to stump up the full deposit of 10 per cent of the house’s purchase price within weeks. At this point, be aware that you will now be bound into a contract with the developer and that a failure to complete on your part will more than likely result in the loss of your deposit.
8. Be aware of all the costs
It doesn’t end there. You still need to factor in the costs associated with solicitors’ conveyancing fees, which can be fixed or a percentage of the property’s asking price and typically range from between €2,000 and €3,000 plus VAT. Add to that the cost of your bank valuation (between €150 and €250 plus VAT), home insurance, mortgage protection insurance, and local property tax (LPT) levied at a rate of 0.1029 per cent of the house’s value. Make sure to take account of and to pay any management fees that may apply to your new home if it’s part of a development with an owners’ management company (OMC) in place.
9. Congratulations
So, you’ve taken the plunge and bought your new home. Congratulations. And further congratulations if you’ve managed to secure it for less than €500,000, as you can now avail of the Government’s help-to-buy scheme, which will offer you 10 per cent of the purchase price of the property back, up to a maximum of €30,000.
