Before you even look at listings
The excitement of house hunting can lead many first-time buyers to start scrolling through listings before they've done the groundwork. This often leads to disappointment when you fall in love with a property you can't afford, or worse, rushing into a purchase without truly understanding your financial position.
The first step in your home buying journey isn't finding a house, it's understanding exactly what you can afford and getting your finances in order.
"The buyers who have the smoothest experience are those who come to us with pre-approval already in hand. They know their budget, they've done their homework, and they can move quickly when the right property comes along."
Getting pre-approved
Pre-approval (sometimes called conditional approval or approval in principle) is when a bank agrees, in principle, to lend you a certain amount. It's not a guarantee, but it gives you confidence about your budget and shows sellers you are a serious buyer.
What banks usually require:
- Proof of income (payslips, employment letter, or business accounts if self-employed)
- Details of any existing debts and regular expenses
- Credit score - check before applying
- Evidence of your deposit (savings plus KiwiSaver)
- Other costs - legal fees, LIM, building report, insurance, etc.
Pro tip:
Pre-approval usually lasts 60-90 days. Time your application so it's current when you are actively looking, but not so early that it expires before you find a property.
Know your true budget
The bank might approve you for $650,000, but that doesn't mean you should spend $650,000. Banks assess what you can repay; you need to think about what you can comfortably repay while still living your life.
Costs beyond the mortgage:
Council rates vary significantly across Hawke's Bay
House, contents, and potentially life/income protection
Budget 1-2% of the property value annually
Power, water, internet, rubbish collection
When to involve a lawyer
Most first home buyers don't think about a lawyer until they've found a property. But there are good reasons to make contact earlier:
- 1 Understanding the process: We can explain what to expect and answer questions before you are under time pressure.
- 2 Family assistance: If family is helping with your deposit, this needs to be structured correctly. It's much easier to do this before you've found a property.
- 3 Buying with someone else: If you are buying with a partner, friend, or family member, there are important decisions about ownership structure that should be made early.
We're happy to have a no-obligation chat before you start looking. Call us on 06 835 7394 or email mailbox@cardow.co.nz .
How we help
At this stage, we explain the purchase process and help you understand what you will need from us when you find a property.
