In today’s market, it doesn’t get any tougher for the typical first-home buyer. It’s also no surprise that roughly a third of Australians opt for a cheaper rental situation rather than take on a ridiculous, million-dollar mortgage.
However, if you still hold the desire to own your own home, there’s hope for you yet!
Let’s look at our top three tips to assist with the deposit-saving woes.
1. Consider your immediate needs
The first home that you buy doesn’t have to be a mansion. Think about what you need right now – for example, if you’re a twenty-something, average income earning single with no kids, then you probably don’t need to spend a fortune on a four-bedroom house on a big block.
Be clear and concise on what you do and don’t need so you’re ultimately eliminating the cost for yourself. Sure, it may mean that you might have to commute a little further to work, or perhaps make other sacrifices, but it’s something you’ll have to accept for now.
2. Start saving yesterday!
If you’re wanting to build a home deposit, then you’ll know all-too-well that it can take a lot of discipline, and unfortunately a long time. But the earlier you start a savings regime the better.
Whatever your income level may be, start saving small amounts by depositing them into an untouchable account.
As your income increase and you start to reduce unnecessary expenses, you’ll be able to increase or multiply those small savings amounts.
The most important thing with this is consistency. Make this part of your weekly routine, even better, schedule transactions within your internet banking to be automatically transferred on a weekly basis.
This way, you don’t even see the money get deducted from your paycheck, and if you’re lucky, you might even just forget about it altogether.
3. Save smarter – Strategising and Investing
Having a strategy is always important to reach financial goals. Start by researching to get an idea of how much of a deposit you require, and what your potential mortgage payments are going to look like.
Collaborate this information to see how, and if, it fits within your budget.
The best method to ‘test’ whether you can afford what you’re looking at, is to practice putting aside the pretend mortgage payment for a while. From here, you can see how much of an impact this will have on your income – implementing the same strategy to save for the deposit. And if you’re still living at home, there’s no better time to begin strategising.
On the other hand, if you have some decent savings already built, a small investment might be a cost-effective way to grow them.
One of these is to buy a car space within a location that’s under development. Once the area is developed you can sell the space for a profit. There are plenty of investment opportunities like this that are relatively cheap and lucrative, however commitment and patience are the keys to these working in your favour.
You may not really want to dig in to your savings at all, however to buy a property in today’s market takes sacrifice and maybe even a bit of creativity.