We’ve gotten used to personal goals, career goals, financial goals and even fitness goals but now there are ‘property goals’. Why?
Out of reach?
Many Australians grew up in big houses on quarter acre blocks, but the reality is, that’s out of reach for many young families in today’s market and increasingly inner city living means more compact spaces.
Younger buyers want to live in locations that reflect their lifestyles but these are often in highly popular and very expensive suburbs. Add to this the new Australian Bureau of Statistics (ABS) figures showing the average first home buyer in Australia needs to save more than $700 per month for almost 11 years in order to afford a deposit in our major cities. Unsurprisingly news stories that young renters are giving up on ever buying a place are increasing.
Feeling that the home you really want in the place you want is out of reach is understandable, but it doesn’t have to be mission impossible. By setting clear, measurable, property goals, you can bridge the gap between a place you’d love to have and what you can afford. Here’s how…
Focus on your lifestyle reality
- Do you really have time to look after a huge garden at the weekend?
- How often do you hit the city nightlife?
- How many spare bedrooms do you actually need?
- Is a pool a must have or something you will use twice a year?
- Is an inner city apartment possible with the pets?
Getting real about what you need in terms of your lifestyle means you may drop some unrealistic property dreams.
Once you define what it makes sense to buy, then you can drill down to your short and long term property goals. Or to put that another way, what you need to do to financially to turn your wish list into bricks and mortar.
Find your unique approach
Pretty much all property goals are going to be majorly influenced by how much you have to spend and how long it’s going to take you to save the amount you need to get through the door. What is unique however, is how you get to that point.
You could consider looking further afield to get a foothold in the market and then plan to trade up once you build up equity and have higher paying salaries. Or you may decide to buy with friends or family, or buy a piece of land and save to build over time. If you know what you ultimately want to achieve property-wise you can be very creative in making it happen.
Thinking outside the square
Genevieve, a Sydney based single mother, realised 10 years ago when she got divorced that she couldn’t afford to buy the type of home she needed in her suburb of choice. “Everything was so far out of my budget, I had to rethink,” she says.
“I made the decision to buy an investment property in a small beachside town two hours south of the city and rent it out so the mortgage was covered. I knew the capital growth would be slower than in the city but it felt like a better choice than buying a pokey apartment in a suburb I didn’t like for us to live in.
Then we rented a great house in the area I couldn’t afford to buy in. In the end I actually doubled my money on the rural property and then had enough of a deposit to buy a bigger property this time on the Central Coast, where ultimately I’d like to live when the kids have left home and keep some horses.
It’s a long term plan, but I now own a home in a community that I want to be part of in the future, and in the meantime we have a great space which suits perfectly, now.”
Finally, your property goals will probably change over time as will the property market, so stay flexible. That suburb that doesn’t seem very appealing right now, may be your perfect neighbourhood five years from now.