First Home Buyers: Avoid These 30 Common Mistakes

One of the most common mistakes first home buyers make is jumping into the property market without getting pre-approved for a home loan. Doing so without pre-approval is risky. You may fall in love with a property only to discover later that you can’t afford it or your loan application gets denied. Pre-approval gives you a clear idea of your borrowing power and shows sellers you’re a serious buyer, making it easier to negotiate and act quickly in a competitive market.

We help first-time buyers secure fast, accurate first home buyer loan pre-approvals so you can buy with confidence.

Many buyers delay entering the market because they believe they must save a full 20% deposit. While having 20% helps avoid Lenders Mortgage Insurance (LMI) and can lead to better rates, it’s not essential. In Australia, first home buyers may be eligible to purchase with as little as 5%, especially through government initiatives like the First Home Guarantee Scheme. Waiting years to save 20% can cost you more in missed capital growth than you’d pay in LMI. A smaller deposit could get you into the market sooner and start building equity right away.

Online mortgage calculators may seem helpful, but they’re often misleading. These tools use general assumptions and don’t take into account your actual living expenses, debts, credit history, or specific lender policies. First home buyers who rely on these estimates often overestimate what they can borrow. The result? Disappointment or failed applications. It’s better to work with a mortgage broker who can give you a personalised borrowing capacity based on your real financial situation, not a generic online estimate.

Your credit score is a crucial factor in your loan approval. Yet, many first home buyers don’t check their credit file until it’s too late. Unpaid bills, old credit cards, or multiple loan enquiries can all lower your score and raise red flags with lenders. A poor credit profile might lead to higher interest rates or outright rejection. Before you apply for a home loan, review your credit report and take steps to clean it up. This could mean closing unused accounts, paying off small debts, or correcting errors that may be dragging your score down.

Just because a bank approves you for a certain loan amount doesn’t mean you should borrow the maximum. Many first home buyers make the mistake of stretching themselves too thin financially, leaving no room for unexpected costs, rising interest rates, or life changes like having kids. Overextending puts you at higher risk of mortgage stress. A smarter strategy is to borrow within your means, leaving enough cash flow for living expenses, savings, and a buffer for emergencies.

Buying a home involves more than just a deposit and loan repayments. Many first home buyers forget to factor in the hidden costs of property ownership, such as stamp duty, legal fees, building and pest inspections, LMI, moving costs, and utility connections. These extra expenses can add up to thousands and if you’re not prepared, they can throw your budget into chaos. It’s essential to create a full cost breakdown from day one so there are no nasty surprises down the track.

LMI is a one-off insurance fee charged by lenders when your deposit is less than 20% of the purchase price. It protects the bank, not you, if you default on the loan. First home buyers often underestimate how much LMI can cost: it can run into the tens of thousands depending on the property value and deposit. Worse, many buyers unknowingly add LMI to their loan amount, which increases both interest and repayments over time. Working with a broker can help you explore options to reduce or avoid LMI, such as guarantor loans or eligible government schemes.

With so many home loan products on the market fixed, variable, split, interest-only, offset. It’s easy to get overwhelmed. First home buyers often focus only on the interest rate, without understanding the loan features or long-term implications. Choosing the wrong loan structure can cost you more in fees, limit your flexibility, or delay your financial goals. It’s important to match the loan to your lifestyle, income stability, and future plans, not just what looks cheapest today. Learn more about our flexible options including construction loans and renovation finance depending on your project.

Lenders don’t like instability. If you change jobs, take on new credit, or deposit large sums into your bank account during the loan approval process, it could trigger delays or loan rejection. Banks re-check your financial situation before settlement, and any red flags could result in a reduced borrowing limit or revoked approval. To keep your application smooth, maintain financial consistency and always check with your broker before making major changes.

Many first-time buyers assume their everyday bank will give them the best deal. The truth? Banks can only offer their own products, even if they’re not the best fit for you. Mortgage brokers like Stryve Finance compare loans from 30+ lenders, negotiate better deals, and match you with the right lender based on your unique profile. A broker also guides you through documentation, pre-approval, and avoids credit score damage by applying strategically. Working with a broker saves time, money, and stress and it's usually a free service for you as the buyer.

Our team compares dozens of lenders for everything from first home loans to self-employed mortgages.

At Stryve Finance, we guide first home buyers through every step, avoiding traps and finding smart solutions that banks don’t always tell you about. We’ve helped hundreds of Australians buy their first home the right way and we’re here to help you too.

Many first home buyers fall into the trap of trying to find their forever home right away, the dream property with everything they want. But life changes. Careers shift, relationships evolve, kids come into the picture, and what you want today might not serve you in five years. Buying your first property is about getting a foot on the ladder, not finding perfection. Focusing on practicality over perfection allows you to grow, build equity, and upgrade when you’re truly ready.

This common myth pushes people into buying property before they’re financially ready. While owning a home builds equity, renting can be smarter if you’re not ready to commit, especially in high-cost areas. What’s “dead money” is paying mortgage interest, LMI, and maintenance costs on a property you can’t afford. Renting while you save, invest, or find the right property can actually be a strategic move, especially when combined with rentvesting.

Without a firm price ceiling, it’s easy to get emotionally invested and overspend during auctions or negotiations. That’s when buyers start compromising, blowing their budget or borrowing too much to “win” the deal. The smartest buyers know their walk-away price and stick to it, even if it means missing out. Emotional discipline will save you thousands and protect your long-term financial wellbeing.

First home buyers often buy based on feelings, how the place “feels,” the light in the kitchen, or the vibe of the neighbourhood. While gut instinct matters, it can easily override logic. You might ignore poor resale value, bad floor plans, or overpay just because you’re attached. Smart property purchases are 80% logic, 20% emotion. Build a checklist, assess pros and cons, and get a second opinion before signing anything.

Granite benchtops, walk-in robes, and a north-facing backyard might be nice but do you actually need them? First home buyers often confuse luxuries with essentials, which can price them out of good opportunities. Start with your non-negotiables (e.g., location, safety, commute), then rank your “nice-to-haves.” This keeps you flexible in your search and helps avoid unnecessary delays or overspending.

Buying a home is a long-term commitment. If you’re planning kids, considering career changes, or might relocate, these should factor into your decision. A property that works for a couple might not suit a family in two years. Think ahead: will the suburb still work for you? Is there room to grow? Planning with a 5-7 year lens protects you from having to sell too soon or worse, being stuck with a property that no longer fits your life. We help you plan ahead with strategic loan structures, whether you’re starting a family, investing, or thinking about a renovation.

Trying to time the market perfectly is a losing game even expert investors struggle to do. Many first home buyers wait years hoping for a better deal, only to be priced out entirely as values climb. If you’re financially ready and have a long-term outlook, the best time to buy is when it’s right for you. Property is a long game, focus on buying smart, not buying at the exact bottom.

Everyone has opinions about property, your parents, your co-worker, your Uber driver. But personal anecdotes aren’t financial advice. Your cousin’s experience in 2008 doesn’t reflect your goals or today’s market. Getting advice from people without real expertise (or current industry knowledge) can seriously mislead you. Surround yourself with qualified professionals, mortgage brokers, buyers agents, and advisors who understand your situation.

Google is a great place to start, but it’s not enough to navigate a six-figure financial decision. Many first home buyers assume reading blogs or watching YouTube videos will prepare them fully but without expert support, you risk missing key steps, overpaying, or choosing the wrong loan. It’s the difference between doing your own tax return and hiring an accountant. Having the right support team pays for itself. Explore our complete range of services, from refinancing solutions to investor lending, tailored to where you are in your property journey.

Too many buyers leave broker conversations until after they’ve found a home, when it’s often too late to fix credit issues, get proper approval, or structure a loan to their advantage. A mortgage broker should be your first call, not your last. They can help you understand your true borrowing power, build a savings plan, access government grants, and set up a strategy long before you apply for a loan or make an offer.

Your mindset is just as important as your money when buying your first home. Emotions, impatience, and lack of planning can sabotage even the strongest financial position. By approaching your home purchase with strategy, discipline, and expert guidance, you’ll set yourself up for long-term success and avoid regrets.

It’s natural to get emotionally attached to a home that feels just right. But first home buyers who “fall in love” too early often end up overbidding, overlooking flaws, or stretching beyond their budget. When emotion clouds logic, you're more likely to settle for a bad deal. The smart move? Always have at least two or three options in your shortlist and be willing to walk away. That mindset gives you negotiating power and protects you from poor decisions.

A beautiful property in the wrong location is still a bad investment. Many buyers focus only on the house and ignore suburb trends, infrastructure plans, school zones, public transport, and future rezoning that could affect long-term value. Buying in a well-researched, growth-oriented area can significantly increase your equity over time. Use tools like CoreLogic or suburb reports, and talk to local agents or property professionals before committing.

Too many buyers get fixated on a specific “dream” suburb without exploring nearby areas that offer better value, more space, or stronger growth. Often, a neighbouring suburb only 5-10 minutes away can offer similar lifestyle perks with a $50,000-$100,000 price difference. Savvy first home buyers keep an open mind and expand their search radius to find the best bang for their buck.

Scented candles, throw rugs, mirrors, and perfect lighting, styling is designed to create emotional appeal and distract you from a property’s flaws. Many buyers are seduced by the aesthetics, without checking for functional issues like bad layout, low storage, noisy neighbours, or natural light. Learn to look past the presentation and focus on structure, quality, and potential. A well-styled property isn’t always a good buy.

This is one of the riskiest shortcuts a buyer can take. A fresh coat of paint might be hiding serious structural problems, mould, water damage, or termite infestations. Building and pest inspections typically cost a few hundred dollars but they can save you tens of thousands in repairs or help you negotiate a lower price. Never buy a property without a professional inspection, even if it “looks fine.”

That quiet street could soon become a highway, apartment block, or commercial zone if you don’t check local council zoning. Many first home buyers forget to investigate factors like flood risk, bushfire zones, aircraft noise, or planned developments nearby. These can affect insurance costs, resale value, and your quality of life. Use tools like council websites, flood maps, or even chat with neighbours to uncover what’s really going on in the area. Need flexible finance for growth? Ask us about equipment and asset finance if you run a business from home or need to invest in tools of the trade.

It’s easy to justify a long commute or sparse public transport when you’re excited about a property but that daily grind adds up fast. Over time, a poor location fit can lead to burnout, resentment, or even force you to sell early. Think beyond weekends: how long will it take to get to work, school, shops, or medical services? Test the route before committing, especially if your work or family needs will change.

Many first home buyers assume they must pay the advertised price or even offer more, especially in hot markets. But the asking price is just a starting point, and many properties are open to negotiation, particularly if they’ve been on the market for a while. Don’t be afraid to make a strategic offer based on comparable sales, inspections, or defects uncovered during your due diligence. Negotiating could save you thousands or secure better terms.

Even if you plan to live in the home, thinking like an investor is smart. Ask: Would this property rent well? Is there demand in the area? What kind of capital growth is expected? This thinking adds a layer of financial security, especially if you need to rent the home out in the future or upgrade and keep it as an investment. Our investor mortgage solutions are designed to maximise ROI and growth potential from day one. A property that appeals to renters and future buyers is a smart long-term asset.

Trying to buy your first property without help is like navigating a jungle without a map. You don’t know what you don’t know. Buyers who skip using professionals like mortgage brokers, buyers agents, conveyancers, or building inspectors, often make costly errors, miss hidden issues, or pay too much. Surrounding yourself with the right team turns a stressful, confusing process into a smooth and informed journey.

Finding the right property isn’t just about looks, it’s about logic, research, and long-term strategy. The most successful first home buyers take the time to learn the market, ask the right questions, and get expert support every step of the way. At Stryve Finance, we’re here to guide you from day one not just with loans, but with location advice, inspection tips, and negotiation strategies tailored to your goals