Five things you need to do to crack into the property market
So, you’d like to buy your first property but don’t know where to start? There are many things you should consider to get started, but I’ve outlined five basic tips to make that first step a bitsimpler.
BY PETER KOULIZOS
1. Find secure employment
It’s a very tough lending market at the moment and banks are keen to lend to people who are a low risk. Having a steady job is one indicator you’re a safe bet. It’s easier said than done but there are a few thingsyou can do to land a job. Firstly, consider gaining new skills or upgrading your qualifications. A few certificates or some letters after your name can fast track your path to secure employment
2. Save a deposit
Once you have an income, you can start putting some aside money for a deposit. A common trend is young people staying at home for as long as they can, paying little or no board and stashing the cash they would’ve spent on rent, electricity, etc.
If you could save $300 per week by staying at home, this would add up to approximately $15,000 in one year. A $15,000 deposit won’t get you far but two years worth of savings ($30,000) plus the First Homeowner Grant (FHOG) and other government initiatives could be enough to get your foot on the investment ladder.
You should be saving regularly and aim for a five per cent deposit. Also keep in mind you’ll need another five per cent to pay fees. Remember, the FHOG and many other concessions apply only if you’re buying a home to live in, not an investment property.
3. Get property educated
You need to ensure you have a very good idea of what you’re doing, where and what you’re buying, and so on. The best way to do this is to educate yourself. Some simple and low cost (or even free) things you can do include reading books, subscribing to magazines like Australian Property Investor, visiting blogs (like you are now!), attending seminars and joining online forums.
If you’re prepared to spend some more money, you might consider enlisting the services of a reputable and unbiased adviser, enrolling on a course or paying for a buyers agent to research and purchase property on your behalf.
Be careful. There are many spruikers who cleverly disguise their high-pressure sales pitches as ‘education seminars’. One indicator you’re being sold to instead of educated is a workshop that heavily promotes off-the-plan apartments for investment purposes.