Forget about getting that gym subscription, go for a few runs each week in the park and save those dollars for your property resolutions. Whether you are looking to buy a home or want to improve your rental home, here are some New Year property resolutions that will help set you up for longterm financial health.
1. I will… increase my equity through smart renovations
Affordable and efficient renovations are the best way to immediately inject more equity into your home, with the bathroom and kitchen being the two key areas where investors tend to focus their renovating dollars.
You can squeeze the most out of your budget by focusing on cosmetic renovations within the kitchen and bathroom. Figure out how you can revitalise these two areas without making any changes to the existing infrastructure and floorplan, as this is when costs can start to blow out. New flooring and refreshed surfaces (benchtops and cupboards) can be all it takes. A great way to suggest luxury in these spots is not to focus on new materials but to source recycled materials, such as timber for benchtops. Spend the time sanding and recoating timber for an antique but simultaneously modern living space. Timber is an affordable and easy material to work with to create timeless designs in your home.
2. I will… become a property expert
The key to owning your first home isn’t getting lucky at auction, it is being a property expert. Thanks to the internet, there has been a democratisation of data and information for everyday consumers, which means that you have more information than you could ever need to help inform your financial decisions.
Stay up-to-date with property news, monitor national and state market trends, research any address in Australia to see what sort of sales trends exist in any pocket of every neighbourhood across the country, while also finding out key demographic and suburb data for that pocket (i.e. schools, incomes, amenities).
Beyond having a strong understanding of what is happening in your neighbourhood, your state, and your country, you should also have a broad understanding of what forces could be having an influence on the economy and the market more generally, such as international politics, trade tensions, and even climate change. Understanding that businesses are operating in anticipation of increasing effects from climate change, you can do your due diligence in understanding what costs might be associated with a home in a particular area, such as insurance premiums.
3. I will… save for my first home
You won’t get very far in your New Year resolution without making some changes to how you monitor and manage your finances. There are various things you can do to help find financial freedom, from creating and monitoring a budget, to reassessing your relationship with debt.
Beyond these, there are two things you can do to immediately start saving for a home.
- Set out a plan. Write down how much you want to save and work out how long it will take you to save that amount. If you want to shorten that time frame, then a budget will help you identify savings opportunities (i.e. do you need a car? Can you live with the parents for a year? Can you cancel any unnecessary subscriptions you might have?).
- Set up automatic payments. One of the easiest ways to start saving is to take the work out of saving. Set up automatic transferrals between your bank accounts for when your salary is paid. Put aside an automatic transfer for fundamentals (bills, internet, petrol, food, rent), then set up an automatic transfer into a savings account and leave the rest for unexpected costs. Whatever you don’t spend from that last account, put into your savings.
4. I will… become an expert at auctions
It’s a good idea to understand how auctions work and the various tips and tricks for making a successful bid at a property auction.
The majority of Australia’s homes get sold at auction, which is why it is important to keep a calm and cool head once you start raising that hand. From coming out strong to holding back until the end, there are various strategies you can take up to give yourself an advantage amongst the crowd.
Apart from having a great poker face, it is important to also know what to expect and what to look out for at property inspections. This way you will waste less time and money during both the research phase of looking for a new home and when actually owning the home.
5. I will… smarten up my rental home
There are some strong arguments out there touting the longterm financial benefits of renting rather than buying a home. The old adage that ‘rent money is dead money’ has been shown by some studies to be outdated and possible even incorrect.
If you are renting a home at the moment, whether or not you intend to do this for the longterm or you are saving for a home, why not improve your living experience through cosmetic improvements to the home. Look at your kitchen for easy and affordable ways to improve your home or invest in high-quality furniture and fixtures that will go with you no matter where you live.