Top 6 Mistakes First Home Buyers Make (and How to Avoid Them)

Buying your first home is an exciting milestone, but it’s easy to make costly mistakes along the way. Many first home buyers in Melbourne overlook key aspects of the property purchasing process, leading to financial stress, delays, or even regrettable purchases. After all, for many people this will be one of the biggest purchases in their lifetime, so getting it wrong can be devastating. Here’s how to avoid the five most common first-time home buyer pitfalls.

One of the most common first home buyer errors is focusing only on the deposit and purchase price while forgetting about additional costs such as:

• Stamp duty (unless eligible for exemptions)
• Legal fees
• Lender’s mortgage insurance (LMI) if borrowing over 80%
• Building and pest inspections

How to avoid it: Work with a mortgage broker to create a clear budget and factor in all expenses. Having a financial buffer ensures you won’t face unexpected financial stress after moving in. Seeking first home buyer advice in Victoria can also help you navigate potential financial surprises.

Many first home buyers start property hunting without knowing how much they can actually borrow. This can lead to disappointment or wasted time on unaffordable properties. Also, revealing your maximum loan approval to agents can weaken your negotiating position.

How to avoid it: Get pre-approved for a home loan before you begin your search. This gives you a clear budget, strengthens your bargaining position, and prevents emotional decision-making. First home buyer tips in Victoria recommend securing pre-approval early to avoid unexpected hurdles when buying your first home.

Many first-time buyers make the mistake of choosing a property based solely on immediate needs without considering future life changes or the suburb’s growth potential. Some fail to research their chosen area thoroughly, missing key factors like local amenities, infrastructure developments, and lifestyle suitability. While properties further out from the CBD may be more affordable, be sure to factor in additional costs from fuel, time spent driving or catching public transport can have a greater impact on your lifestyle than you’d think.



How to avoid it: Research the suburb before purchasing. Look into future development plans, lifestyle factors, and long-term investment potential. A home should meet both your current and future needs. General first home buyer advice in Victoria includes considering the long-term growth of your chosen area before making a commitment.

Not all home loans are the same, and choosing the wrong type (fixed vs. variable) or failing to compare rates and terms can lead to higher long-term costs. Many first home buyers also underestimate the importance of a financial buffer to handle unexpected expenses, such as how much interest rate changes can affect your mortgage repayments.



How to avoid it: Research different loan options, compare interest rates, and speak to a mortgage broker to find the best deal for your situation. Ensure you set aside additional funds for unforeseen expenses. Following first home buyer tips in Victoria can help you navigate the complexities of selecting the right loan.

Skipping legal reviews or not thoroughly examining a property’s potential for value growth is a major first home buyer mistake. Failing to review the Section 32 Statement (Vendor’s Statement) or conduct necessary inspections can lead to unexpected surprises like zoning restrictions, outstanding rates, or expensive repairs.



How to avoid it: Have a property lawyer review the Section 32 Statement before signing any contract. Conduct thorough building and pest inspections to assess the property’s condition and potential for value addition.

One of the most common first home buyer mistakes is not consulting a qualified property law expert. Legal oversights can lead to contract disputes, unexpected costs, or even lost deposits. Many first-time home buyers don’t realise that contracts can include hidden clauses, zoning issues, or financial obligations that may not be obvious to non-legal experts. Without professional guidance, buyers risk signing agreements that could be disadvantageous or difficult to exit.

How to avoid it: Seek first home buyer advice in Victoria from a property law specialist to ensure your contract is solid, your rights are protected, and your home purchase goes smoothly. A property lawyer can help identify potential risks, negotiate better contract terms, and provide clarity on key legal documents. This extra layer of security can prevent costly legal disputes and ensure you fully understand your obligations before committing to a property.

Avoiding these common first home buyer mistakes can make the process a lot smoother and potentially more financially beneficial. From securing loan pre-approval to researching the market and reviewing legal documents, the right preparation helps you buy with confidence. With these first home buyer tips for Victorian buyers, you can feel better prepared to make that life-changing property purchase a reality. 

Buying your first home is a big step, but having expert legal guidance can take the stress and confusion out of the process. Avoid common first home buyer errors and ensure a smooth purchase with MLS Legal—your trusted property law specialists. Contact us today!