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Saving up to buy a home is a serious long-term process

Saving up to buy a home is a serious long-term process

If you want to become a homeowner in Australia today, it is not going to be cheap. According to research from RP Data, the average price of a home is $852,000 in Sydney, and $641,200 in Melbourne.

You’d have to be extraordinarily wealthy to pay even a fraction of that money upfront with the cash you have on hand. More than likely, you’ll have to spend years saving.

Preparing to own a home is a long-term process. It involves assessing your finances honestly, mapping out a realistic budget and spending years making a genuine commitment to saving. Are you ready for that? If not, you may just need a little guidance and encouragement.

Drawing up a budget that works for you

As you go through the process of assessing whether you can afford the deposit and mortgage repayments required to buy a home, you’ll need to be highly self-aware about your finances. The Australian Securities and Investments Commission recommends devoting some time to tracking your spending – you might find that you’re spending a lot more than you thought on certain expenses you overlooked.

Once you have a full account of what you’re spending on, and how much, you can use that information to carve out a budgetary plan that’s realistic. Maybe within a few years, you can plan to have enough money saved up for a down payment.

Demonstrating your commitment to saving

It’s difficult to accumulate the cash needed for a house unless you have a plan for consistently putting money away in savings. If you save the unexpected cash influxes you get, such as tax refunds or bonuses at work, that’s great, but cautions that that alone is likely not enough.

Lending institutions will have more faith in you if you can show a habit of saving money consistently – ideally, a regular amount that you take out of your wages each month. Once you’ve done this, you can clearly demonstrate that you’re prepared for whatever home loan interest rates come your way.

Getting help from a broker when you’re ready

As you go about saving for a home, it’s good to have people on your side who will help you plan for your future. That’s why it pays to find a mortgage broker who will guide you at every step of the way.

Contact the team at Premium Portfolio Finance if you’d like to learn more. With over 40 lenders at our disposal, we are well versed in the mortgage market and are ready to assist you with your needs.

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