1. Consider Your Finances

Most people can get a home loan from most lenders as long as you provide at least a 5% deposit from the house’s price. In general, though, you want to have at least a 20% deposit since the deposit amount impacts your loan-to-value ratio (LVR). From a lender’s perspective, LVR makes up your risk as a borrower and your borrowing power. 

Other than the upfront costs of buying a home, you also need to make sure you can pay your mortgage loan repayment. Thus, it’s important to evaluate your finances before you invest in a property. Do you have enough cash to make a down payment or can you afford to take on the cost of repaying your mortgage? You’ll also want to keep an eye on the interest rates. The impact of your mortgage interest rates will depend on the type of loan you get.

For instance, if you choose a floating-range mortgage, the size of your monthly payments could fluctuate alongside the interest rates. Meanwhile, a fixed-rate mortgage means your rate is locked in, regardless of which direction the interest rates move. Any small differences in your mortgage interest rate can add up quickly, which might cause you to spend too much or save a lot.

Make sure to check for mortgage rates in the area. If you’re looking for a house in New Zealand, then you can compare NZ rates here. Lastly, it’s better to talk to a home loan specialist or your lender about your options and help you find out how much you can borrow. 

2. Check The Market

Depending on current economic situations and other factors, the real estate market can move either to the seller’s or buyer’s favour. A buyer’s market means that there are more houses for sale than buyers. A seller’s market, on the other hand, occurs when fewer homes are on the market than buyers. 

These market conditions can determine how much room you have when making an offer. Talk to a real estate agent who can help you understand the real estate market in your area and how it’s currently affecting buyers. 

3. Think About The Location

Couple stood outside new home

Whether you’re moving to a different country or staying in the same neighbourhood, you need to research before spending your hard-earned money. 

Most people want a home close to school, a shopping district, or their workplace. Consider if you’ll have easy access to the main roads and check for traffic flow. Some people want proximity to the city, while others prefer a more peaceful, suburban life. The location also has an impact on the price of a house. For instance, houses in city areas tend to be more expensive than those in the suburbs. Most locations have their own unique advantage. So, make sure to research what suits your needs or budget before deciding which property to settle in. 

4. What Are Your Lifestyle Needs?

Your lifestyle can also help in determining the kind of house you want and can afford. Do you need extra space for accommodating an elderly relative who can’t live alone? Is there a new baby on the way? Do you love to cook? Then you might need a home with a larger kitchen. Meanwhile, getting a home with a bigger backyard can satisfy your habit of planting your own food or accommodating your pets.

In addition, your lifestyle can also impact your budget and mortgage payments. Do you need to take a weekend getaway every month? Do you have a gym membership or maybe working out with a personal trainer? Do you love collectible items? 

In general, you need to give yourself a little financial room by subtracting the cost of your expensive activity or hobby from the payment you calculated. If the balance is not enough to buy the house of your dreams, then you need to cut back a bit or start thinking of getting a more affordable home. 


If done right, buying a house can be both a good investment and a smart purchase. It is a contradicting experience of stress and excitement. As a result, it’s important that you keep in mind the above factors before closing a deal on a new house.