28 Jun 2021

I’m not going to lie to you, the housing market is absolutely ridiculous at the moment. No matter which city you live in, prices are skyrocketing and it looks like they’re not slowing down anytime soon.

No matter how many times your parents tell you to hurry up and save, it’ll never be like the days when they paid off their $70,000 four-bedroom house (inflation, et cetera but sorry mum and dad, that’s nothing compared to the average $1 million we’ve gotta save up for now).

Plus, when the media rambles on, talking smack about how we’re spending too much of our hard saved dosh on avocado toast instead of saving, bugger off - we’re young and we’re a generation of eating brunch on a Saturday morn.

 

What if I told you that you could do both? Enjoy your brunches, nights out and young adulthood years while still saving? Look, it may sound impossible but hey, if I’ve been able to do it after one year of full-time work, you’ll be able to do it too.

Here’s the goss on how I avoided paying off somebody elses mortgage and invested in myself:

Ask questions + take your time researching

The best words of wisdom you’ll receive are from people who have already bought. Talk to your parents, your friends’ parents, your sporting coach, your manager - they all love sharing a bit of insight on how they’ve done it. Plus, there are hundreds of resources online and forums to find out whether or not buying is for you.

Speak to a broker (no matter how little you have)

These guys help you through your goals and set you up with a plan. They’ll want to know how much you’ve got saved, what debts you have (HECS, car, personal loans), what your weekly expenses are. They work out whether you can afford mortgage repayments, bills and life based on your earnings. Did I also mention that they’re a free service?

Save for a deposit

Whether you’re just starting your savings plan or got some decent dosh saved in there, work out how much you’ll need for a down payment. In Australia, you only need 5% of the overall house to secure a house. 

Don't aim too high

This isn’t going to be your dream home that you live in forever. You don’t need the fanciest lights, nicest blinds or furniture. Start off small and work your way up!

Consider moving into the suburbs

If you live close to the city, it would be pretty hard moving further out but as an investment, it’ll pay off. You’ll save up a deposit quicker as it won’t be as high, you’ll get bigger land and more freedom. If work is flexible, hey, why not?

Live with your parents for as long as you can

This is a tough one for many people but moving back in with mum and dad was the best financial decision I made. I was able to save up the money I was spending on rent, groceries and bills. Suck it up as much as possible and know that there is an end goal!

Read up on the grants available in your state

Government incentives can make or break your decision to move forward in purchasing. In NSW, you can avoid paying Lenders Mortgage Insurance (usually in the thousands, a one-off payment for security if you have under a 20% deposit) with the First Home Loan Deposit Scheme and wave or partial stamp duty (tax paid to the government whenever you purchase a property) with the First Home Buyer Assistance Scheme. In NSW, you could also qualify for a $10,000 First Home Owner Grant. 

So take note and read up on your state - these can massively increase your chances of getting into the market ASAP!