The great Australian dream: How difficult is it becoming to achieve?
The Great Aussie Dream. It’s still achievable, however it’s never been more difficult to accomplish. Countless years of hard work and strict saving habits are the very least of the criteria needed to be followed to buy a property in this day and age, and if you’re planning to do it on your own, the pursuit is exponentially more painful.
Most people would agree that owning property reflects their financial success – and they’re probably right. Sydney and Melbourne are by far the most difficult markets to break into, however its other regional areas around Australia that are becoming increasingly more popular for first-home buyers. Recent reports and studies indicate that many are seeking the help of family or close friends to share the dream with, but even then, it’s proving to be a struggle.
Statistics will show that people who bought a property within the last four years, were three times more likely to have borrowed money for the deposit from family or friends, than those who bought property more than five years ago. It’s becoming apparent that young people wanting to buy a home in a particular area of choice are asking for parental guarantees and considering co-ownership. This is being seen more and more among owner-occupiers rather than investors as saving for that dreaded deposit is what’s killing them in the process.
If you’re lucky enough to scrape enough cash together to put down a deposit, the next big challenge is keeping up with expenses, especially within the initial two years of ownership. This is why many are choosing to buy with a partner, friend or family member, as expenses and costs can be split down the middle, easing the financial burden slightly.
Budgeting is another issue among first-time buyers. As you can start to see, there is a pattern here. One problem can generally lead to another, in which they are all interdependent starting from the beginning – which is not saving enough to begin with.
It’s not hard to underestimate that true costs of owning a property, everything from maintenance and repairs to insurance must be considered and be accurately accounted for. Property ownership is obviously a great way to grow wealth with so many associated benefits, especially tax advantages, but getting started can be unbelievably difficult.
Many people choose to buy property over shares as a home is a tangible asset, whereas shares are basically an ‘investment on paper’. Buyers want that feeling of owning something they can physically see and ‘have’.
If you’re one of these people who are struggling with getting into the Australian property market, here are a few quick tips to give you the upper hand from the get-go.
- Ensure you set a budget you can realistically work with.
- Do your homework and research recent sale prices in the same area as you’re planning to buy.
- Figure out, and set your priorities. What are the most important things to you when looking for that perfect home?
- Go and scope out the suburb first-hand and see what it would actually be like living there.
- Chat to a finance expert about all the options that are available to you before making any decisions.
Make sure to read our article Buying your first home – 7 Important things people forget