Buying a home as a single parent

Written by in Buying on August 6, 2017

Buying a home as a single parent

Housing affordability is a much debated and emotionally-charged aspect of public discussion. But buying a home as a single parent is almost never mentioned. Perhaps because it seems like an oxymoron. Couples are struggling to save for the necessary deposit for homes in Australia’s larger cities. What chance is there of buying a home as a single parent?

Why should a single parent want to even buy? Because you may find that renting creates a level of uncertainty for you, especially if you are a single parent. You may be sick of the impending end-of-lease date. Or the stress of finding a new home, made all the harder when you need to pick up the kids from school but have an inspection to attend. Of course, buying a home has its own level of uncertainty, especially buying a home as a singe parent with a single parent’s income. That’s why you need to prepare and understand the extent of this uncertainty.

How to prepare when buying a home as a single parent

Get yourself on Excel.

Preparing a thorough budget is the only way to gauge the affordability of buying a home as a single parent, and to what degree there may be uncertainty/risk in taking on a mortgage with one or more kids by your side.  A budget will tell you in black and white whether you can afford this move. In one scenario, you may just have to concede that you cannot afford to buy at this stage of your life and that you need to look towards smaller investment measures that you can afford or work towards increasing your income with a clear idea of your budget for the next few years. So, at worst, a budget can help direct you in the right direction to buy, even if it isn’t going to be now.

Budgeting using Microsoft Excel

If you can afford to buy, but what you can afford doesn’t tick all the boxes you think you require, then prioritize. For instance, you may need to prioritize space for your children over having a separate laundry. Include your family into accepting these relatively small sacrifices that are necessary. For instance, you may need to sacrifice on having a yard. This isn’t a huge sacrifice to make if you seek out properties within distance to parks.

Lastly, with your budget in mind and your investment goals linked to this budget, do you want a house that you will renovate? A budget will tell you what sort of cash flow you are likely to have, and whether this cash flow will allow for renovations.

Tip: save yourself some time and use’s Budget Calculator, Savings Target Calculator and Affordability Calculator in unison for a clear picture of what you can afford.  

Now that you know what your income is, how does this affect your ability to get a loan?


Understand what you can use as income.

As a single parent, you are often entitled to government payments providing your income does not exceed a certain amount. Certain mortgage lenders will in fact accept these government payments as evidence of your income. Be sure to ask about this when researching mortgage lenders. Compare what they offer. Ask how they approach single parents in comparison to couples when it comes to their customer relationship management and loan policies. A good mortgage lender’s answer should reflect the company’s strong relationship with customers from a range of income and socio-cultural backgrounds. It is therefore sometimes better to seek out a loan while your children are younger, to monopolize on these government payments that may end when your children reach a certain age.

Model house with a jar and coins scattered.

Look at your state’s relevant First Home Buyers Grant, if they have one or something similar. Remember that these policies do change. In Victoria you can currently receive up to $10,000 for a new home in metropolitan Melbourne. In regional Victoria new homes receive up to $20,000.

Lastly, seek professional advice. The expense of developing a relationship with a mortgage broker, accountant and/or financial adviser is an investment vital to purchasing property without putting yourself in financial risk, especially when buying a home as a single parent. A professional, who knows the industry well, can channel you in the right direction. For example, they can help you find lenders receptive to single parents. They can also provide you with the knowledge to get the most out of your earnings and benefits.