How to make your first real estate purchase successful?
That’s it. You are ready to take the plunge. The time to own your home has finally come. Still, you need to make your first real estate purchase a success! The traps are not lacking. How to avoid unpleasant surprises? Here are some tips to follow to tip the odds ever in your favour.
Define your current and future needs
Like any important project, a real estate purchase requires a minimum of preparation. Avoid homes that are not adapted to your needs at all. Take the time to think. Try to plan for the future as much as you can. Establish the list of criteria to be met by the property. Would you like to buy in a specific geographical area? What is your need for space medium and long term? Do you prefer having a garden, a balcony or a terrace? Is a garage essential, or is a parking space enough for you? Do you want to buy a new or old property?
Do not forget that a property is unlikely to meet all your criteria. Also, rank these in order of priority and point out your non-negotiables.
Study the property market
Forewarned is forearmed. This proverb cannot be more relevant when you want to become a homeowner. Find out about current conditions in the property market, whether it's taxes, new regulations, duties or housing subsidies. The Editus Home property blog is a good source of information, but there are many more.
To get a good idea of the supply and demand in Luxembourg, it is best to consult the Housing Observatory website. This body was created by the Ministry of Housing in 2003. It aims to inform the public about housing issues. It regularly publishes diverse information on its website such as the prices offered for sale and rent, land potential, land consumption and reconstruction in residential areas and the comfort of housing.
Take your time
We’re saying this right away. It will take you several months to find the property of your dreams. Beware of ‘crush’ shopping. Large sums are at stake. You are likely to commit to many years of mortgage repayment. Do not hurry a purchase because you are afraid that you’ll miss out on the property. Haste has never been a good counsellor. View as many different properties as you can to compare.
Still haven’t found anything that fits your needs within your budget? Do not be discouraged. Do not buy a property by default. Instead, put off buying and wait until other properties come onto the market or you have a larger budget.
Prepare your viewings carefully
The viewing is a crucial step when buying a property. Organise it in the best way. Prepare a list of questions to ask the seller beforehand. Keep an individual record to fill out as you hear the answers. This yay, you will minimise the risks of confusing it with another property, especially if you have four to five scheduled visits in the same week.
At the viewing, focus on the practical and technical aspects. Inspect the ceiling, walls and windows. Check the electricity, insulation and heating situation. Make sure the property has enough space. Be attentive to the noise. As needed, get help from qualified professionals. The results will sometimes surprise you. The property that seemed in good condition to you is only good on the surface and vice versa. When you’ve found the house that ticks most of your boxes, have several viewings at different times of day. Who knows? You might discover that the property you were lusting after lies under a morning flight path!
Bargain on the price
Nowadays, practically no private sales go ahead without any negotiation. Set yourself a reasonable target – 10-15 percent of the asking price, on average – and stall. Time is on your side, not the buyer's. In addition, many properties have been on sale for several months or even years. They do not find a buyer because sellers are camping at an inappropriate price. With a bit of persuasion and a lot of luck, you could convince the vendor to lower their expectations and eventually accept your offer.
In summary, to succeed in your property purchase, rely on confidence and perseverance.
Often you hear people say: “Anyway, until I have paid off my home loan it’s the bank who owns my house”. But is it true?
It is always the same question that every one of us is asking before signing a home loan with his bank. To gain a more objective overview, let’s analyse them one by one with their respective advantages and disadvantages.
The rate remains fixed for a pre-defined period and, at the end of the period, is subject to a revision. The pre-defined period can vary from one bank to another but is generally 3, 5 or 10 years.