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Can You Afford To Buy Your First Home?

For the longest time, buying a home was one of those things that was just sort of treated as an expected part of life. It was up there with a career, a marriage, and all of the other things that make up the stereotypical path of someone’s life. Of course, as time has gone on these things have become less and less necessary to live a happy life but when it comes to buying a home, something else has happened. There are just as many people who would love to buy a home as before, but it’s become more and more difficult. The reality is that with house prices constantly going up and wages stagnating, many people end up feeling as though the idea of actually being able to buy a home is little more than a fantasy. But is that actually the case? Of course not! The truth is that it’s still entirely possible to buy a house, even if it’s not as easy as it once was. You’ve just got to be prepared to put in the effort to understand the process, and make sure that your finances are in the right position to do it. With that in mind, here are just a few things to consider when trying to figure out if you can afford to buy your first home.

The mortgage

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The most obvious thing that comes to mind when people are thinking about buying their first home is the process of getting a mortgage. After all, unless you happen to be extremely lucky, you’re very likely not going to be in a position to buy a home outright. (If you are then what are you doing reading this?!) The issue for a lot of people is that the process of getting a mortgage can be rather scary and complex. After all, you often end up having to wade through stacks of paper with all kinds of confusing clauses and small print. Not only that but your success in actually applying for a mortgage can often depend on a number of factors. Using something like a home loan eligibility calculator is a great first step in checking to see what kind of mortgage you may be able to take out. That way, you can figure out any potential changes that you might need to be able to buy a home and what it could end up costing you in the long term.

The deposit

One of the biggest barriers to a lot of people’s ability to buying a home is very likely to be the deposit. For many people over the years, they’ve been able to buy a home with incredibly small deposits that made buying a home and getting a mortgage a whole lot more accessible. This is something that has become even more pronounced in the era of COVID-19. Where previous generations might have been able to get a home with a 1% or 2% deposit, there are many lenders who won’t accept less than a 10% deposit in the current era. When you combine that with the rising house prices then it’s clear that being able to afford a deposit is a much bigger challenge than before. However, just because something’s a challenge doesn’t mean that it’s impossible. The key is to start putting money aside as soon as possible. If buying a home is something that you’re really committed to then every spare bit of money that you have should be put away. Find new ways to budget to allow you to save more and every bit of extra cash that comes in should go in the pile. It isn’t necessarily going to be a fast process, but it’s the only way to really afford a deposit in the current era.

The fees

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Image by Steve Buissinne from Pixabay

It often comes as something of a nasty surprise to a lot of people when they realise just how many fees are involved in the process of buying a home. If you’re not aware of the fees that come with buying your first home then you could end up in some serious trouble. You have to consider mortgage fees, a valuation fee, a survey fee, a potential broker fee, your solicitors fee, and a whole lot more. Now, most of the time these are things that you will be taken through at the start of the process but you need to be aware of these kinds of fees well in advance so that you don’t go into the process assuming that you can afford a home when you simply can’t.

Your credit rating

As strange as it might sound, it’s not just a matter of having the money and actually being able to afford a home, you also need to be able to demonstrate that you can afford the payments in the long term. The way that this is calculated is through your credit rating. If you have a poor credit rating then it won’t matter whether you have the money for a deposit or not. Things like paying off your credit cards on time and making any loan payments in full is the best way to ensure that your credit rating is always in the best possible shape.

The truth is, while it is absolutely possible to afford to buy your first home, it would be a mistake to assume that it’s something that’s going to be easy to do. A home is likely to be the most expensive purchase you ever make and that’s not something that you should take lightly. If you want to buy a home then you’ve got to be willing to think ahead. It’s the kind of thing that you need to plan for and make changes in your life if you want to be able to afford it. The mistake that a lot of people make is that they assume that they can’t buy a home when what they actually mean is that they can’t buy a home “right now.” By planning ahead, managing your finances, and working towards a goal, you’re going to be in a far better position to buy your first home regardless of your personal circumstances.

Living Options: What Makes An Ideal Place To Call Home?

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Where you choose to live is arguably the most important decision of your life. It can affect the people you meet, the job you get, and your general quality of life. It’s also a huge financial decision. It’s never something to be taken lightly, and there are many things to consider before you call a place home.

There are many living options to consider. You might opt to buy a house, or rent an apartment. Some people even choose to live out of a mobile home. Other factors, such as what’s available in the area, also make a difference. Here are some of the factors which can make an ideal place to live.

Affordability

Affordability is forefront on most people’s minds when they choose a home. Living somewhere beyond your means will only drain your bank account month by month. With less to pay, you’ll be less stressed and have more money for other things.

Many young people prefer to rent homes for this reason. Buying a house is a massive investment, and also involves cost such as upkeep and insurance. Apartments and rental homes often work out much cheaper in every regard.

Location can often have an impact on affordability. Some places are more sought after than others, leading to higher property prices. For affordable living spaces, you may need to look further away from busy city areas.

Local Amenities

The stores, services, and features which surround a house or apartment have a significant impact. Convenience is key, so having supermarkets on your doorstep can be a big help. Many people also enjoy having local parks and fitness centres near their home.

These features often affect the value of properties. Houses near lush green spaces and plenty of bars and restaurants will often be more expensive. Universities often build campuses to provide affordable student housing with great amenities. Housing companies often do a similar job by building affordable homes in attractive neighbourhoods. You can find various examples of these, such as yarrabend.com.au.

Nearby schools also make a great place to live for families. Many parents look to buy homes near the best schools in the area.

Safety

Crime is a concern for most people looking for a home. Having to insure yourself against the high-risk of burglary can be expensive. People also fear for their personal safety when walking home in some areas.

Before moving to a new home, people often do their research on sites like myboot.com.au. Although these areas can be cheap, people would much prefer to stay away from dangerous suburbs. It’s also a major concern for those raising families, as they want their kids to be safe.

Proximity To Work

People often dread the commute to work in the morning. Having to travel for hours on a train can be mind numbing. Driving during rush hours can drive commuters mad.

That’s why a home close to your workplace makes a fantastic place to live. If you’re close enough to walk or cycle, you can go to work every day in a good mood.

It also helps to be close to friends and family. Having the people you love nearby can improve your quality of life, even if you don’t have the nicest accommodation!