It seems that every day we see articles in the paper about house prices continuing to go up, about the halo affect from Auckland and the general unaffortablity of houses for first home buyers. Despite property prices in many parts of New Zealand being at record levels it's still possible to beat the market if you're smart about it. There are also signs that things may be easing with various reports lately that the rate of increase may be slowing down.
Thoroughly research the city / area you want to live in. What are the different suburbs like, what amenities do they have like schools, shops, restaurants etc. Are there any areas that are 'up and coming'? Are there any major developments happening in that area? e.g. new roads or transport links, new schools, housing developments or shopping centres?By properly researching the area properly beforehand you put yourself in a great position to make the most informed decision about how to spend your money.
The cost of buying the sort of house, in the area you want right may be out of your reach right now, however you can still get a foot on the property ladder by buying a rental property and renting yourself elsewhere.
No doubt about it, saving up a 20% is hard, especially with prices continually going up. It might be time to re-think your current living situation in order to decrease the amount you spend on rent and increase the amount you can save in a short time for your deposit. Could you try house sitting or in what is becoming increasingly common, move in with a family member.
Maybe getting a house on your own is just that little bit out of reach at the moment, but with the help of another person the impossible suddenly becomes the possible. Whether it be a friend, partner or family member, going shares in a house is a great way to get a foot on the property ladder. Just make sure, before you jump in, everything is water-tight legally and that it is clear what will happen in certain situations (e.g. if one wants to sell but the other doesn't).
Already own a property but you want something bigger / better/ newer/ different and can't quite afford it? Instead of moving why not think about renovating your current home to better suit your needs? Not only will you not have to part with the 'dead money' of moving (eg real estate agents fees, legal fees, removal companies etc) but you'll also increase the value of your home, potentially making it easier to move on in a few years time (if you still want to that is).
If the numbers just aren't working out for you when it comes to buying a home, consider renting out a room (or two) in your house and living in a flatting type situation until such time as you can easily afford the repayments by yourself (or use this extra money to pay down your home loan faster and reduce your interest costs and mortgage term). If you're not quite ready for a full time flatmate the likes of Airbnb now make it easier to make a little extra money from your spare room(s) as and when you want.
The information contained in this article is of a general nature and should not be taken as advice. It reflects the opinions of the writer only and does not necessarily reflect the opinions of New Zealand Home Loans.