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Saving for a house deposit isn’t just about tucking every dollar away. Having a strategy in place and an understanding of the housing market you’re entering will help you reach your goal of owning your own home sooner.
Buying a house is a widely discussed topic, with many different opinions on the best way to enter the market. Rather than getting caught up in the whirlwind of information, a good place to start is to adopt some smarter saving strategies.
Understanding how much you need to purchase your first home is more than just the deposit amount. You also need to account for the upfront fees such as stamp duty, insurance and establishment fees. Once you have calculated the total amount you need, you can start planning how to reach that goal.
A house deposit isn’t a magic number that you can pull out of the air. You can have a well-informed house deposit goal through understanding the property market that you’re entering and keeping up to date with trends and reports. Key trends to keep track of include dwelling values, housing affordability, median house prices and interest rates.
The First Home Loan Deposit Scheme, First Home Owner Grant and First Home Owner Assistance Scheme are in place to help you land your first home. If you’re saving for your first home, research the schemes available to see if you’re eligible to apply as they can reduce the amount you pay in stamp duty or how much you need for your deposit.
Many small changes can make a big difference when saving. Take some time to sit down and analyse the basics in your lifestyle that can be tweaked to more cost-friendly options. This could be as simple as making your lunches and daily coffee at home, sticking to a shopping list or using public transport.
Once you have your house deposit goal, start planning your budget to get there. Set yourself timeframes for your saving milestones, know how much you must put into savings each week and schedule monthly check-ins to assess your budgeting.
Storing and tracking your savings is key when saving for a house deposit. Ensure that you’re keeping your savings in a saving-friendly account with beneficial interest rates, and separate your spending and saving accounts to minimise the risk of temptation and consolidate your current debt.
Renting while you are saving for a house can be tough. In this case, there are multiple changes you can make to your renting situation to help. Monitoring your appliance usage, comparing your energy suppliers to ensure you’re getting the best deal and recruiting a housemate are some examples of how you can make renting easier while you save.