Buying a new home is a big commitment, so it’s wise to gather as much information as you can before you sign on the dotted line.

When you're looking for the perfect property, a little information can go a long way. You want to be sure you're making informed decisions with confidence, and that you're across insights that can give you an edge over competing buyers.

But with so many websites, apps and tools out there, where should you start? We've rounded up some of the best calculators, sourced some useful apps, and asked Pratham Karkal, Head of Personal Banking Direct at Macquarie’s Banking and Financial Services Group, for his insights on what you need to know before buying a property.

Getting your pre-home-purchase finances sorted

Before you start looking for the perfect property, it's essential you know exactly how much you can spend.

At least six months before you’re ready to start looking, Karkal recommends talking to your bank or mortgage broker.

“Have a conversation about what you'd like to borrow, and work with your bank to see if you can get to that amount. If you can’t, work with them to identify what you'd need to do, to increase your borrowing power.

“It might be decreasing credit card limits, or cancelling cards altogether. You might want to adjust your spending habits. Banks will look back three-to-six months to assess your ability to budget, and understand what you’re spending money on.”

Be aware of the additional costs of buying a home

You'll also need a healthy home deposit – preferably at least 20 per cent to avoid paying Lenders Mortgage Insurance. This savings plan calculator will show you how quickly a regular payment into a high-interest account can add up.

Don't forget to factor in the extra costs of buying a home – such as stamp duty, inspection reports, conveyancing and any urgent repairs you may need to make before moving in. This stamp duty calculator makes it easier to work out how much you'll be up for in your state.

Once you're comfortable with all these details, it's worth getting pre-approval for your loan. In a competitive market, you want to be confident you can make the right move, fast.

“Regardless of whether or not you're going to go ahead, you should absolutely get pre-approval,” says Karkal. “A pre-approval means you've spoken to your bank, and they've said, ‘Yes, based on what you've told us or provided us, we're happy to lend you this amount.’

“It's not a written contract, but at least you know what you could potentially borrow and that could save you a lot of stress. We've had countless examples of people making an offer before getting pre-approval – then they’re scrambling around, asking for deposits from family and friends. All of that can be avoided.”

Knowledge is power when it comes to property purchases

Now you have your finances in order, the fun of the search can begin. First, narrow down where you can afford to buy.

“Immerse yourself in it; don't rush,” advises Karkal. “If you want to live near a specific place, print out a map and draw a circle around it – 8kms, 20kms, whatever you’re comfortable with. You might identify a suburb you’ve not considered.”

Domain’s nationwide home price guide tool, has a useful feature for families – the School Zones Guide. Plug in the address of a property and it will tell you the local schools and catchment area. This is often a big motivator for moving. The suburb profile view also provides some valuable data.

Finding the real value of your property-to-be

Once you have decided on suburbs and found a property that interests you, the first thing you need to do is find the property’s 'true' value.

It’s vital for buyers to get an independent price estimate. Real estate agents are working for the vendor, and it’s in their interests to sell for the highest price.

While asking an agent for their price guide can be useful at the beginning, this will often be at the higher end of what it may sell for.

Domain’s home price guide tool is a valuable source of independent data on property prices. Type in any address, anywhere in Australia, and it will tell you what the home last sold for and what its estimated price range is now. You’ll also get helpful additional information, such as a guide on the property’s weekly rental income and its predicted rental yield.

The data is drawn from Domain's APM PriceFinder, Valuer general information and auction results.

This can help you decide if it's worth spending money on a building inspection, and give you more confidence if you want to bid at auction or negotiate a private treaty sale. But keep in mind, the price guide tool isn’t a substitute for a bank valuation and your lender might value the property differently.

The benefits of understanding why a property is being sold

Karkal also advises doing your research to find out why the property is on the market. “Understanding the motivation for selling is half the battle,” he says.

“Talk to real estate agents – if it's being sold because of a divorce, they may want a quick, quiet sale.

“If it’s been on the market for a while, find out why.”

Some properties may not even make it to a public listing, so it’s good to talk to local real estate agents about what you’re looking for.

Real estate agents and mortgage brokers are also a good starting point for market insights.

Real estate agents, property listing websites and major banks all use CoreLogic's comprehensive property database – and that independent data is also now available to homebuyers through Property Value. While some tools are only available by subscription, you can use its data to get a snapshot of the suburb profile and make comparisons of suburbs, properties and even residential investment strategies – with pros and cons for each option.

It's certainly never been easier to gather all the information you need on your property search. Save time, stay one step ahead and make more confident decisions – the answers are at your fingertips.

Key takeaways

  • Work with your bank or mortgage broker at least six months in advance to ensure your finances are in order.
  • Get pre-approval before beginning your search.
  • Identify the suburbs you want to live in before you start looking at properties.
  • Talk to your mortgage broker and real estate agents to get a feel for the properties and prices in a suburb.
  • Once you find a property you’re interested in, get an independent valuation.
  • Understand the motivation for selling – you might be able to use it to your advantage.

Speak to a home loan specialist today to get your home loan pre-approved. Call 13 62 27.

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Unless stated otherwise, this information has been prepared by Macquarie Bank Limited ABN 46 008 583 542 AFSL and Australian Credit Licence 237502 and does not take into account your objectives, financial situation or needs. You should consider whether it is appropriate for you. All applications are subject to Macquarie's standard credit approval criteria.