Are you in your twenty’s? If so, home ownership may either be the furthest thing from your mind (perhaps because of a perception that it is unattainable) or it may be a goal on which you are intensely focused.
Perhaps you are a parent with adult children living at home and wondering how an earth your kids will ever be able to afford the ‘Great Australian Dream’ the way you could at their age.
Is there a ‘right time’ to buy your first home? The answer is no. In fact owning a home during this early stage of life can be a burden if you’re not ready.
Here are 6 things to consider if you’re thinking about buying a home in your twenty’s.
- Get comfortable with making sacrifices– Saving for a deposit or paying off a mortgage takes sacrifices. These sacrifices may include things like swapping a bought lunch during the working week to BYO lunch from home, getting creative with your wardrobe and entertaining friends at home rather than going out.
- Don’t be afraid of having a debt– Given that the median price of a house in Perth currently stands at around $517,000 ($410,000 for a unit) most young people need a substantial mortgage for their first home. Remember, no lending institution will approve a loan for you if they feel you can’t afford to pay it off. That said, the number can still look daunting when you are not used to having a debt any higher than perhaps a loan to pay off a car. Remember, you have around 30 years to pay it off. Keep reminding yourself of the long-term benefits of owning property.
- Welcome DIY projects– You will find that owning your own home will make you want to improve the space you’re in. Given most won’t be able to afford to have refurbishments done for them by a professional, it’s time to roll up the sleeves, get out the paint charts and get ready to do it yourself. The rewards of your efforts will be worth it.
- Stay on top of what the market is doing– Sign up to newsletters and blogs written by professionals (like the one you’re reading right now), research the market, say yes to receiving market updates. The more you know, the better the decisions you will be able to make in relation to building your wealth through property.
- Stay on top of bill payments– If you live independently before you buy your first home, you will be familiar with bills rolling in. But for those who buy their first home after living with mum and dad, receiving bills will be unfamiliar territory. Get used to it! And stay on top of your bill payments. One way to do this is to set yourself up for electronic payments.
- Regularly remind yourself of the massive achievement you have made– It can be hard to stay mentally focused and enthusiastic when your friends are still partying and you’ve got bills and a mortgage to pay. Keep reminding yourself of the incredible achievement you have made in owning your own home and take it day by day. Don’t be overwhelmed by the idea of a thirty-year commitment.