First home buyers are back in the market as a result of the interest rate cut and rising rents. But many potential first home buyers don’t get to first base in their quest to achieve home ownership because they haven’t saved enough money for a deposit. If you’re one of them, consider some of these tips for savings success. There are plenty of creative strategies you can employ to swell your bank balance.
• Talk to your specialist first home loan broker.
We have up-to-date information of the Lenders policies with regard to savings requirements – you may just need a little bit of guidance, for instance, some Lenders will consider as a savings record, the rent you have been paying. Tip: Rent through a rental agent for at least 4 months – your name on lease.
• Follow the traditional method for getting together a deposit – such as opening a special deposit account and save a set amount of your wages each payday. Set a goal and don’t withdraw from that account. Deposit your tax refund. Deposit any gifts or winnings. Put a bulk amount in a fixed term account to earn higher interest. Keep adding as much as possible to the deposit account for at least 4 months. This is what the lenders wish to see.
• Sell unused assets
Could you get around without a car? Do you need the second fridge you have parked in the garage? And how often do you really use that expensive treadmill that is gathering dust in your lounge room? Unused household goods and appliances can fetch a handsome sum in the second hand trade, so review your clutch of assets and see which ones could be converted to cash.
Bear in mind: Most (but not all) lenders require evidence of genuine savings for your deposit (usually 5% of the purchase price), so try and plan ahead with your savings and/or sale of assets.
• eBay your smaller goods
Don’t just look at larger assets for resale: smaller goods such as CDs. books, video games, children’s toys and collectibles can also generate some stellar returns. If you sell just 25 CDs at an average of $10 a pop, that’s an extra $250 earning interest in your home deposit savings account.
Bear in mind: eBay recently reduced fees for casual users, so your first 30 listings per month are free.
• Convert your hobby into cash
If you love small children list your services on gumtree.com as a casual babysitter: you can earn anywhere from $15 to $25 an hour tax-free. Or, if you can sew, create some cute garments or headbands and list them on etsy.com. Whatever your hobbies or talents are, look for ways to monetize, your spare time.
Bear in Mind: It’s important to bank your profits when you’re paid in cash, rather than fritting them away on trivial expenses. Remember, every $50 you save takes you one step closer towards owning your first property. Set a goal and stay the course.
“You’ll be a homeowner in no time!”
