Dreaming of buying your own home but can’t afford it, It is very difficult in Australia to get on the property ladder. You know what, apparently, there are ways to make this dream possible though it might take time.
Even though this blog post is tailored to Australia anyone can read it as the basic principles of property would be similar.
It is important to know the options available to you so that you can make use of them hence the reason for writing this post.
Thanks to my collaboration with Helen Micallef from AR Property Investments she shared a few points with me to make your dream possible.
Helen stated the following;
1. Save as much as you can and have at least 5-10% deposit
2.Some banks are willing to land up to 95%
3. There is a mortgage insurance costs on top of the cost of buying a house so add this to the cost.
4. If you can’t afford to buy a house due to your income being low, according to Helen Micallef there are other ways of eventually owning a home in the long run.
That is, you can start by buying an investment property. So what happens is, when the bank calculates your income the rental income from this property would be added to your normal income.
The investments property are usually interest only. So it means that your goal is not to payoff this mortgage but you are capitalizing on the house prices going up. Then when market prices go up you can sell your rental properties if you managed to buy more than one and buy a home.
For this strategy to work you will have to keep your investment property for a long period. The rationale behind investing in the property is to make your money work for you instead of it sitting in the bank and earning minimal interest rates.
I asked Helen the following question?
Q. Suppose you buy a house on the basis of low interest rates, the when interest rates go up then you can’t afford to service the mortgage?
Response. Interest rates do not just rise by a huge amount over night so if even they do increase it is usually by small percentage.
Look I enjoyed this collab with Helen and she had so much valuable information to share. I must say she awakened my passion for creating a portfolio of properties which I had put on hold.
If you really want to go on the property ladder, Helen’s contact details are as follows:
Appreciate your comments or sharing my posts. I hope this information has been helpful in making you take step towards owning your home.
Thank you for reading,
Love & Blessings