Buying your first home, how does it all work?

So, you’re ready to buy your first home - great. But, where do you start? Pre-approval, mortgage brokers, auctions, it can all be a tad overwhelming. Take a deep breath, things are about to get clearer.

From approval to settlement we’re going to guide you through the journey to having your dream home.

Get pre-approval for a home loan

First thing’s first, before you start to house-hunt it’s important that you know how much you can borrow. Your bank or lender will decide if a conditional approval (also know as a pre-approval) can be offered to you and for what amount.

If you have a pre-approval you will be in a better position to negotiate. Plus if you’re going to auction this will give you a lot more confidence when bidding.

A mortgage adviser can help organise your pre-approval so you are in a strong position when negotiating for your new home.

For more information on pre-approvals click here.

Find legal representation

Having the right solicitor or lawyer on your side is crucial to the buying process. Your solicitor or lawyer will take care of the property transfer process including completing checks on the property and advising you on the loan documents, builders reports and council records. They do the hard yards to help make sure you’re getting the right deal for you.

For more information on the role of solicitor click here.

Let the house hunting begin

Now that you know what sort of budget you’re working with the fun part can begin; bring on house hunting.

Once you decide on an area you’d like to buy (and can afford) then you can start your search by looking online or speaking with some local real estate agencies to let them know what you’re looking for.

Building inspections

Before you commit to buying, it’s a good idea to get a building inspection done to make sure there aren’t any building defects or other problems. A building inspection will check a range of issues, but importantly the inspector will look at watertightness, whether the property has any earthquake damage or if there’s been drug use. You can also order electrical and drainage inspections if you want to. An inspection can cost anywhere between $450 - $800, but is worth it to avoid any surprises and extra costs in the long run.

Make an offer

After you’ve had the property inspected and you’ve got a solicitor on your side, you’re ready to make an offer (cue excitement). There are two types of offers:

  • An unconditional offer is an outright offer to buy the property, according to the terms set out in the agreement.
  • A conditional offer is when your offer to buy has conditions attached, for example, arranging finance or being satisfied with a building report; importantly, you get to decide on the conditions.

If you’re buying property at auction only an unconditional offer can be made - meaning it’s really important to ensure you’ve got all finances in order.

For more information on how to be prepared or your first auction click here.


Settlement is when the balance of the purchase price is paid to the vendor, the keys are handed over to you (whoo hoo) and the property is registered in your name.

You’ll need to make sure the property is insured at the time of settlement as lenders will not release the loan funds to your lawyer without a certificate of currency (showing insurance has been paid). A safe course of action is to obtain a certificate of currency just prior to declaring the agreement unconditional.

We are always available to give you more in-depth information about the buying process and what options are best suited to your situation.

If you’d like to find out more, please register for one of our first home buyers seminars or download our first home buyers guide here.