One tangible sign that a person has “made it” is a place that they can call home to return to every day.
A house is the stable foundational unit that allows families to stay secure and comfortable, even amidst financial hardships. This is especially true in today’s tumultuous housing climate, as many property prices are soaring faster than the average person can afford across the globe.
Once shelter is secured, fully paid, and accounted for, the family can have the privilege to work towards their own personal and professional goals without having a large cost burden looming overhead.
That said, the path towards homeownership is rife with challenges and difficulties. It’s not uncommon for prospective homeowners to be tied to a long-term mortgage that spans years or even decades, chipping away at financial freedom.
However, sacrifices have to be made for the benefit of the entire family. Fortunately, with the proper strategies, goal-setting tactics, and approaches, it’s more than possible to secure a home without feeling fully constrained by a dizzying mortgage.
If you’re looking to start your journey towards buying a home, then you’re in the right place. This guide will give you some tips on how to make homeownership not just a faraway dream, but a reality that you can provide to your family.
Let’s take a look at these tips in more detail.
1. Create a Realistic Timeline for Buying Your Home
Another crucial element of the homebuying process is the timeline for its completion. From vetting different real estate properties to improving your WBC borrower profile for loan contracts, there are a lot of little tasks that can take up a big portion of your time.
Without a timeline, the entire process can feel overwhelming. Moreover, it’d be easy for you to miss out on a task or two if you rely solely on your memory. As such, it’s a good idea to create a timeline and set short-term milestones to ensure that the homebuying process is as organised and smooth-sailing as possible.
To start creating a timeline, begin by setting target dates for major milestones, like packing day and move-in day. Then, further divide them into phases. Consider setting aside some buffer days as well to ensure that slight hiccups won’t derail your plans. Then, review this timeline regularly to ensure that you’re on top of your tasks.
By setting a timeline, you can keep yourself motivated and accountable thanks to the sense of order it brings.
2. Set Clear Goals For Your Future Home
The most important factor that you should consider before jumping into homeownership is your reason. Define your why, and get your family on board.
Most people want a new house because of the privacy it provides them and their family. Others want to have an asset to their name for generations to come. Others want a property that can grow and be sold for a higher price down the line. Some families may simply need more space to accommodate a growing family or new pets.
Regardless of the underlying motive for homeownership, it’s essential to be clear about your reason and have your family know it too. This way, you can make moves to actualise that dream and make it a reality.
One effective method of goal-setting is following the SMART goal-setting framework. SMART is an acronym that stands for specific, measurable, achievable, relevant, and time-bound. This structure helps you set clear, realistic, and trackable homeownership goals.
For example, instead of saying “I want to buy a house soon,” a SMART goal would be to save $25,000 every six months to save for a down payment for a house. This goal fits the criteria within the SMART framework and makes it more possible to achieve.
3. Start Saving Up Early
The harsh reality of homeownership is that it will always be a costly experience. This is inevitable, so if you wish to become a proud homeowner in due time, then you’ll have to pull yourself up by the bootstraps and get to work. And with the money you’ll gradually accumulate, you’ll be one step closer to saving for your dream home.
First things first, open a dedicated savings account for your future home. Park funds there whenever you can. This will help you stay focused and committed to your goal.
If you find yourself struggling to make a dent in your savings, then here are some tips. Set automatic transfers to that savings account to ensure a frictionless experience; you can do this by talking to your employer and bank agent about it.
Another actionable tip is to cut back on non-essential spending. Take a look at your monthly expenses (create a budget if you don’t have one!) and see what can be sacrificed in the future. Maintain that sense of discipline until you achieve your goals.
By consistently saving up your money, you can eventually reach the amount for a property down payment. It could take months, if not years, to start, but it’s one of the few surefire ways to open up the doors to achieving your dream home.
4. Explore Financial Assistance and Loan Options
The silver lining in homeownership is that you don’t have to dish out the entire purchase price of the home right from the start. You can access several financing methods to help you secure a home at a lower starting price in Australia and around the world.
In Australia, in particular, there’s a grant called the First Home Owner Grant (FHOG) that grants new homeowners the privilege to reduce the upfront cost of buying a house. This can be a great way to reduce the cost of buying a house (as well as the other fees attached to it), which typically starts at a million for Sydney-based residents.
That said, the most common financing option for Australians is to opt for a home loan. There are several types of home loans that can help you get one step closer to being a homeowner. These include the following:
- Variable rate loan: A loan type with an interest rate that moves based on market performance.
- Fixed-rate loan: This loan’s interest rate remains fixed starting from the date the contract is signed.
- Split loan: A hybrid loan type with fixed and variable influences.
- Interest-only loan: You only pay the interest for a set period. Principal remains unchanged.
In any case, it’s typically a good idea to consult with a financial professional before figuring out the best loan type based on your financial circumstances and goals. This will help open the doors for better deals and loan contracts coming your way.
5. Research The Construction and Renovation Process
Another essential consideration to make before owning a home is how you plan on acquiring it. You can buy an older home and have it renovated, or build one from scratch. Both of these options are viable and will require a bit of construction to turn them into something livable.
In both scenarios, it’s essential to secure the right permits for renovating the house. Moreover, set up a plan of action on how you’ll tackle the renovation process. If you’re building from scratch as a first-timer, it’s in your best interest to talk with licensed builders, foremen, and construction workers to ensure that your home is structurally sound.
On the other hand, if you’re simply renovating a pre-existing house, then the cost won’t be high, but you’ll still be involved in the renovation process. You should prepare to set aside a portion of your budget to ensure that the standard of your new home is high and valuable for you and your entire family.
In any case, preparing a proper blueprint and plan of action when building a home is a crucial step to ensuring its smooth construction. And this all starts with choosing to build a home from scratch or simply patching up an existing one.
We hope these tips will help guide you in your upcoming homeownership journey. All the best!