Wondering how to get into the property market as a single person? Buying property is daunting for most people, particularly if it’s your first home – and no matter whether you’re buying on a single or combined income. But, there’s no need to wait for the perfect partner to come along to buy a property; building up assets and investing in property is an excellent way to set yourself up for the future. The median house price in Perth is currently sitting around $520,000 and interest rates are at an all time low – making it an ideal market for new home buyers.
So, how do you prepare yourself to enter the property market as a single person?
Reduce your debt and stay in your job:
It’s inevitable that most of us have some sort of debt; whether it’s credit card debt, a car loan, a personal loan. When banks look at your capacity to pay off a mortgage, they’re not just looking at your current income. They also want to see that your debt is minimal or being steadily paid off, that you don’t have significant debt across several banks, credit cards or other institutions, and that you don’t have a high credit card limit. Even if your balance is at $0, knowing that you have the capacity to max it out to a high amount can be a liability. Don’t switch jobs while entering into mortgage discussions, and ensure that you have a stable income.
Find a mortgage broker:
If it’s your first (or even your second, or third!) time buying property and you’re not too confident with the money side of things, a mortgage broker may be just what you need. A mortgage broker can help you find the perfect mortgage deal for your personal circumstances, and have access to many different lenders. They have an obligation to ensure that you don’t end up with a loan that you can’t pay off. In some circumstances, the broker will take a commission from the lender, and in others they will let you know upfront about any fees. Shop around for brokers, ask friends and family for recommendations, and make sure your mortgage broker is accredited and credible.
You’ve found the perfect house, cleared some of your debt, and got a mortgage broker on board. So, how are you going to keep up payments in the long run? Get creative. If you’re buying a two or three bedroom property, rent out your spare rooms to friends or housemates to make the repayments a little easier. If you’re buying a home at $520,000, the approximate repayments are around $619 a week – which will seem much more feasible with other contributors. If you don’t want permanent housemates, consider AirBnB or other similar programs to rent out a room or the whole property when you’re away to make some extra cash.
In conclusion, buying a home as a single person is far from a pipe dream – and it could be your reality! Start putting plans in place to reduce your debt and get finances in order, and think about what you’re looking for in a home. It’s a big commitment, and worth it in the long run. Get in touch with the team at ACTON today to start your investment journey; we’re here to help!