First-time buyers are driving strong demand for two-bedroom apartments this spring.
Buying your first property is more than securing a place to live – it’s the first step in building long-term wealth and financial security.
But costly mistakes are common. We see them regularly in our advisory work, and they can set buyers back years.
That’s why we’re unpacking the most damaging errors first-time buyers make – and the practical strategies to avoid them.
The goal is simple: help you make smarter decisions now, so you’ll thank yourself for years to come.
Don’t wait for finance – Start learning now
Too many home buyers sit idle until their loan approval comes through. Yes, securing pre-approval is critical and can take months depending on your employment situation, but there’s no excuse for wasting this time.
Start educating yourself the moment you seriously consider buying.
Define your non-negotiables: Which areas suit your lifestyle? Can you handle main road noise for better apartment value, or do you need tranquility with transport links? What trade-offs will you accept – adjacent developments if you’re buying a house, or warehouse aesthetics in a converted unit?
Consider property formats: High-rise apartments, villa units, or detached houses? Do you crave outdoor space or prefer avoiding strata fees? Decide on your renovation appetite – turnkey ready, light cosmetic updates, or major transformation if you have the skills.
Sorting these priorities early means you’ll hit the ground running when finance is approved, avoiding hasty decisions under pressure.
Use first home buyer grants strategically – Don’t let them control you
Government incentives can boost your buying power, but letting them steer your property choice is backwards thinking. First, map out your eligibility: stamp duty relief, cash contributions, or reduced lenders mortgage insurance allowing smaller deposits.
Understand the conditions: many schemes lock you into living in the property for 6-12 months, eliminating immediate investment potential. Some have hard price ceilings (full benefits to a limit, then zero), others use sliding scales.
Don’t fall for policy agendas pushing new builds or regional purchases. If a grant nudges you toward an off-the-plan apartment or location with poor growth prospects, you’re losing money long-term.
Victoria’s Homebuyer Fund contributes up to 25% but retains that equity stake. Think carefully about implications for renovations or future gains.
Lead with your goals, then see which grants support them. Never let the tail wag the dog.
Don’t get caught up in property type assumptions
Preconceived ideas about what you ‘should’ buy often derail smart decisions.
Start with your endpoint: early-twenties buyers climbing the ladder should prioritise investment fundamentals and equity growth. Families with children need practical features like school zones and parks over investment metrics.
Drop the rigid thinking. A solid villa unit might deliver better returns than a flashy apartment if it aligns with your needs.
This targeted approach ensures your first purchase serves as a genuine stepping stone, whether for immediate living or future leveraging.
Forget perfect – Focus on potential
Perfect properties don’t exist. In 25 years, I’ve never seen one, regardless of budget.
Stop chasing unicorns and concentrate on what you can’t change: location, orientation, architectural bones. Paint and kitchens are easily updated.
First-timers often obsess over polished presentations while missing gems with solid fundamentals. Get the structure and position right – you can enhance everything else while building equity through improvements.
This mindset shift reduces frustration and sharpens your market focus.
Don’t go it alone – Understand the process and get professional help
Misunderstanding how property transactions work costs money and opportunities. Learn the methods. Auctions demand unconditional bids with pre-arranged finance and inspections – no subject-to clauses allowed.
Private treaty sales offer flexibility, though unconditional offers typically win. Expressions of interest create uncertainty; off-market deals need insider connections.
Know who works for whom. Agents represent sellers (who pay them), not you. Expect vendor-biased advice.
Assemble your own team early. Conveyancers for contract analysis, building inspectors for structural issues, accountants for ownership structures, potentially buyer’s agents for professional guidance.
Going solo against experienced players is foolish. Build your support network.
Never skip due diligence
Cutting corners on research guarantees regrets. Organise financing early to know your true limits and avoid emotional overspending.
Have conveyancers examine all contracts for permits and potential problems – contact councils or strata managers directly when needed. Always get building inspections.
Do independent valuations instead of trusting vendor statements or comparable sales data, which often justify asking prices rather than reflect genuine value. These can mislead in both directions.
Thorough checking prevents nasty surprises and protects your investment.
ON GROUND CASE STUDY
Strategy beats ‘free money’
Some time ago, we guided first-time buyers obsessed with sub-$600,000 apartments to maximise stamp duty savings. They wanted pristine, modern developments and were laser-focused on grant benefits.
We showed them the reality: sub-$600k properties were inflated by grant-driven demand, while mid-$600k options sat neglected despite superior quality and potential.
We redirected their search toward a six-unit block with substantial land content – excellent growth fundamentals, though not their initial aesthetic preference. It passed in during the $500s; we negotiated under $600k, securing both the duty exemption and superior long-term value.
Today, that significant land component offers redevelopment potential, allowing them to leverage into their next purchase while keeping this as an investment. Smart strategy delivered both immediate savings and future opportunities.
Take home message
First home buying combines excitement with genuine pitfalls. Research early, use grants as tools not drivers, align purchases with real objectives, embrace potential over perfection, understand market mechanics, and never compromise on due diligence.
Master these fundamentals to minimise mistakes and maximise outcomes. Consider how this purchase fits your bigger picture: investment potential, leverage opportunities, portfolio building.
Get expert advice now to position yourself for long-term success – smart decisions today create wealth tomorrow.
Further learning
Check out the ‘Your First Home Buyer Guide’ podcast with Megan Wells and Veronica Morgan for more insights and practical guidance throughout your journey.
Listen to Jarrod’s podcast: