It’s not uncommon for people to feel a bit hesitant when it comes to buying a house. We get it: it can get scary and exciting at the same time. Investing in a home, or real estate demands time and commitment. And a plethora of other reasons that hold you back from buying your home— financial, economical, or some other personal limitation.
However, you can’t really use those reasons as excuses to get away with not buying one. You might have googled several keywords that might have included whether investing in real estate would be worth the effort. And, the results had been overwhelming. But today, Living Home Loans is here to bust those very excuses and show you that you have every reason to get your own house! Common excuses we hear are:
I can’t get the deposit together
These days there are a tonne of grants available for first homeowners and options for parents to go guarantors – link to our page on how much it actually costs. Have you read The Barefoot Investor? We’ve seen tonnes of FHOs who now have ING accounts called Daily Expenses, Splurge, etc etc. These people have knuckled down and done the deed to save the money needed to get over the first line. The lowest amount of deposit you will need is around 5%. This will give you a reasonably high-interest rate for one year, but after that one year, you can switch to a fixed, low-rate product. If you can get 8% together, then you have a multitude of options depending on your situation.
**Your options include – guarantors, gifts, grants, and your own savings.
I don’t want to be locked into a 30-year mortgage
Seriously? The way that most people get ahead in life is by leveraging borrowed money. When you borrow money, the key thing to consider is how this loan is going to help you build your overall wealth. Robert Kiyosaki’s Rich Dad, Poor Dad, provides a great lesson in this.
'Only ever borrow money that is going to be positively geared immediately!'
Well, of course, this is not a widely followed principle but if you stay in the arena of making sure that the money you borrow is being put to a use thatis expected to make you money – rather than loans like car loans, that will NEVER make you money – unless it is a classic car of course. You see where we are going. Get over the idea of staying out of debt. Debt can be good or bad debt. Avoid bad debt and get used to the idea that you will have good debt if you want to build wealth for your future.
I don’t want to be locked down in one place
Whether you are a global nomadic or a hipster who doesn’t want to get tied down, or just prefer to keep your options open for opportunities that may arise in the future – you don’t need to make this a reason to prevent you from entering the property market. You can simply rent out your property. There are some key things to keep in mind to ensure you have this flexibility in the future. But getting in on the property market opens up options as you start to build your wealth for the future. Things to consider are:
- how much would it rent out for
- will it cover its own expenses
- will you need to cough up a bit as well (cashflow positive properties can be a better choice to really allow you freedom of choice in the future)
- What are the rental vacancy rates for the area? Lower vacancy rate areas are also better for life freedom as you don’t want to be worrying about having to cover costs if it is vacant for an extended period of time.
- Who will manage it? If you are not going to be close by to manage it yourself, or don’t want the stress, then it is advised to find a good property manager to do that for you – look for one via other’s recommendations.
I don’t want the responsibility
You are responsible for your tenancy that you are in now, as you have to tick the boxes for your landlord, and they can pull the rug out from under you at any stage. The idea of responsibility can be scary, but in actual fact, it opens up much more choice and it builds self-esteem. If you are concerned about maintenance, then you can look at a low-maintenance property with regular inspections from professionals such as termite inspectors, etc.
I don’t know how to get a loan
Don’t worry, you don’t really need to! We take all our clients through the process, step by step and even assist in areas where many other brokers don’t go…. like when conveyancers aren’t talking to each other to press the settlement buttons.
I can’t afford a loan
This is a bit of a furfy at the moment, because most people that are getting a steady income and paying rent, can afford to purchase property. Perhaps right now, you might be up to y our neck in credit card debt or struggling to curb the outflow of money from your wallet. But if you take a look at how much it will cost you to make monthly repayments on a home loan, you’ll see it can often be less than the rent you are already paying. And yes, the rates and water expenses do go on top of that but again, you are generally paying for these in your rent to cover your landlord’s mortgage and utility charges.
At the end of the day, it’s totally up to you and the amount of effort you are willing to dedicate to this. Obviously, we are willing to help you out with every step of the way. That’s why it’s suggested that you do some research on your own. It won’t take more than an hour to pull up some searches on Google. Not only will it help you gain more knowledge regarding the topic of owning your own home, but it will also help you gain confidence in your decisions.
You know how when your brain starts to think something is true because you’ve told that very thing long enough to convince yourself, even if it’s not true? Yeah, that’s how you’ve come to believe these barriers.
Now that you know there’s a loophole in each of the above “excuses”, you can get started with the planning and purchase that dream house!