Fear of awful neighbours

First there was FOMO then came FOOP, but it seems uninitiated buyers have another source of anxiety, according to new research, writes Kirsten Craze.

FOAN, or Fear of Awful Neighbours, is on par with loan rejection for first-home buyers. Finder’s First Home Buyer Report revealed 35 per cent of first-time purchasers are afraid of bad neighbours, just shy of the 36 per cent who feared being rejected for a loan.

Buying in the wrong location, or committing to an address long term were among other worries.

Finder home loans expert Richard Whitten said buyers are often attracted to a location because of its sense local community.

“Having nice neighbours is a universal desire — Australians want to be able to let their kids play with the family next door or swap gardening tips with the local green thumb,” he said.

“A friendly neighbourhood is also often a safe neighbourhood, which is a priority for more than a quarter of first-home buyers.”

Although today’s buyers have access to more information than generations before them, Mr Whitten said researching who lives next-door or upstairs is challenging.

“We always say at Finder that you should compare home loan rates, do your homework and due diligence but it’s very hard to suss out what the neighbours are like,” he said.

“When most people buy a house, and especially during the boom of the last couple of years, they really only do one or two inspections.

“You might get lucky and see someone out the front or maybe make a snap judgment based on the appearance of their front yard, but that’s about it.”

One tip for buyers looking to purchase an apartment is to study the strata report or turn to a professional.

“It’ll cover the goings on in the building and could mention any serious disputes among neighbours, even if it doesn’t tell you much about them individually. Online reviews or Facebook groups can also help for larger buildings so it’s worth sometimes just Googling the address.”

Buyer’s agent Michelle May agreed that a little internet digging is essential.

“I commend first-home buyers for even thinking about neighbours because it’s actually something that can completely ruin your enjoyment of living somewhere,” she said.

“If you’re surrounded by anti-social neighbours then you’ll be moving quicker than you may think.

“We join local Facebook groups and scour for buzzwords like; disturbance, police, noise, or parties.”

Savvy buyers should also consider visiting the address at different times to get a true feel for the neighbourhood beyond what the selling agent wants you to see.

“Whether it’s to find out about neighbours, or to hear flight path noise, go and sit in your car and just listen and watch what’s going on,” Ms May said. “You can’t take this kind of research too lightly because if you make the wrong decision and did want to sell in the future, it’s going to be headache — especially in a market like this one where buyers can be, and should be, more picky.”

Finder’s First Home Buyer Report also found that fears of not qualifying for a mortgage in the current rising interest rate climate were growing.

Regional buyers were more likely to be concerned about getting approved over city slickers (41 per cent compared to 35 per cent).

“Applying for a home loan can be nerve-racking, but there are things you can do to increase your odds of approval,” Mr Whitten said.

“Your lender will look at your financial statements and spending behaviour, so it’s a good idea to avoid splurging too much in the months leading up to your application.”

The Finder expert added that it’s a smart idea to check your credit score this is what your lender will look at to assess whether you’re a good borrower, and it can also impact what interest rate you get.