In this series, we get the real story from new first home owner about what it’s really like to buy their first home. If it’s as hard as we’re told, how are the thousands of Australians who do buy for the first time each year manage it? Melbourne couple, Meg and Nick, said it took “time, patience and more patience”.
Meg (24) and Nick (30)
Occupation: Hairdresser and mechanic
Mortgage saving time: 3 years
Search time: 20 months
It was the inflexibility of renting that drove Meg and Nick to the decision to buy their first home- particularly with renovations and having pets. “The idea of paying off someone else’s mortgage also really bothered us, as it does many other renters!”.
Finances: How did they afford it?
Long standing savings habits meant the pair had a foundation of savings prior to deciding to save for a home, which sped up the process of accumulating enough wealth for a deposit. Setting up a separate account for deposit savings which had a strong interest rate also was helpful- as was creating another account for “rainy day” costs so as not to take from from deposit savings and interest accumulation.
“ We were saving for a while, so I was able to set a really realistic budget and I gave myself “fun money” every week to pay for my coffees and dinner out with the girls- that is important for my sanity!”
Searching: What helped/ didn’t help them in finding their dream home?
The search for the right home took much longer than expected- almost 2 years. The couple put this down to buyer competition, not having clear property criteria from the beginning, and following price estimates only to invest time and resources and be outbid come auction day.
“Every month we had a regroup and discussed everything we’d seen and reset our minds. Real estate Apps like the realestateVIEW.com.au Apps were super helpful for me so I could search and shortlist properties to compare.”
Requirements: What were they searching for?
In contrast to other first home buyers, location was secondary to property requirements such as outdoor areas and spare bedroom for entertainment and guests. “We looked all over town!”, said Meg “especially as I’m a hairdresser who works from home- I needed that separate space for my work, as well as guests”.
Advice: What recommendations do they have for current first home buyers?
“I wish we knew all the costs involved in purchasing ; conveyencing, stamp duty , land transfer, rates , connection fees, utilities. The best advice I can give is don’t buy at your maximum budget! Work out what your repayments will be for different mortgages eg. $370,000 vs $385,000 because whenever that interest rate changes, your repayments will change.”
Are you a Melbourne first home buyer like Nick and Meg? The Real Estate Institute of Victoria (REIV) are hosting a FREE seminar this month where home buyers can receive professional advice from expert leaders about the current property market, how to choose the right home for you, relevant laws and more. To secure your place, click here.