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What you need to consider before buying your next home

Everything You Need to Know About Buying Your Next Home

The dust has settled on your first home — you have paid down your mortgage — and you are now considering buying your next one. 

As per your previous experience, you anticipate that this time is going to be just as challenging and exciting, if not more.

Before you make another major financial decision, read more to learn everything you need to know about buying your next home.

What you need to consider before buying your next home

As buying a house comes with many highs and lows, there are things you have to ponder upon before undertaking this potentially life-altering event. It may be useful to have a think on the following questions:

Common reasons for buying a second home

  1. Holiday home: A holiday home is an option you can explore if you want a second home as a resthouse or secondary residence. You can also have rented for short term periods. 
  2. Selling your current home: Selling your property before you buy lets you know exactly how much you have to spend on your next home. On the other hand, buying before you sell is generally a riskier proposition. Read this article to help you decide whether or not you should buy or sell first.
  3. Family: It is commonplace for parents to buy a property for their children or assist them in purchasing one. 
  4. Retirement: Some elderly people purchase a home for retirement to hold wealth or downsize. 
  5. Investment: A second home is a great way to build your property portfolio and get into the property investment market. Look for an affordable investment property in an area where there is a high tennant appeal. 

Can you use the equity in your current home to buy your next home?

Equity is the difference between your home’s current value and the amount you have left to pay on your home loan.

You can access the equity in your current home to finance your deposit for your next home if you have made extra mortgage payments over time or if the market value of your home has increased.

Talk to a professional mortgage broker to know more about your equity and your borrowing capacity.

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What are the costs associated with second home purchase?

There could be additional upfront and ongoing costs you have not dealt with before when you bought your first home. 

These costs include, but not limited to:

Find out more about these costs Find out more about these costs

Talk to us

Your next home purchase must have careful planning and constant sound advice from a professional. 

To get access to competitive home loan rates, talk to a Pivotal Financial specialist and let them do all the work for you to ensure you have not just a Pre-Approval but the right loan, right rate and peace of mind knowing your next move is your best move.

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