When the Australian dream seems out of reach
For many people who don’t already own their own home, reaching that goal may seem out of reach in 2018. In the space of a relatively short period of time, house price increases have pushed many first home buyers, particularly younger people, out of some property markets.
If you’re feeling like you’ve missed your chance at home ownership, here are some things you can try to give you some perspective and help you figure out what to do.
Live like you have a home loan
There’s an easy way to understand the financial commitment of owning your own home: pretend you already have one. To do this, use our borrowing power calculator to work out how much you can borrow.
By using the calculator, you will see what your monthly repayments would be. Your job then is to save the difference between that and your rental costs, without fail. In the process, you will see how you will have to live once you have a home loan, at the same time saving money for a deposit when the time comes to buy.
Once you get an idea of what it is like paying a mortgage, you will have a better idea of if that is indeed what you want. It’s easy to feel like you’re missing out by not owning your own home and it seems like all your peers do. You might find that you aren’t ready to settle down, and the money you are saving might be better invested somewhere else.
If you find your heart is still set on buying a home, it’s time to knuckle down and do some old-fashioned research. With your new-found knowledge of how much you can afford to borrow, work out what you can afford to buy, and where. Get to know what is involved in applying for a home loan, and how much you will need for a deposit. There is no shortage of online resources when it comes to property, so try and educate yourself from as many sources as possible.
Now that you have a realistic idea of what you are aiming for, you can plan how to get there. If you don’t have enough for a deposit now, your “live like you have a home loan” savings plan will tell you how long it will take you to get there. By sticking to the plan and doing your research, you will make sure that when you are able to buy, you will be ready to make well-informed decisions.
In the market for a home loan? Our free comparison service compares hundreds of home loans from leading lenders in one place.