Home & Health
Family Finances: Financial growth and the Australian dream
The Aussie dream of owning your own home has been steadily slipping away for many modern families. With the cost of living, rising property prices AND the juggle of raising a family, adding a mortgage into the mix could be cray-cray, right? But with the array of first home buyer incentives available at the moment and the right property guidance, that dream might be feasible once more.
“Money is cheaper than ever,” says Troy Sussman from Your First Home Co. “In South East Queensland we have a growing property market, plus there are some amazing government and building incentives available to help get you in market. Though it might seem like an unattainable dream, for many, buying a property is not as impossible as it seems.”
Getting your finances in place Troy believes that a major part of getting your finances in place is about education. “Nine out of ten people are in a far better position than they think,” Troy says. “With the help of budgeting and tips on how to save, it’s amazing how many families can get their finances in place to purchase a property.”
“We can sit down with you to find out your money and property goals, and we can also connect you with a trusted mortgage broker to assess how much you can borrow.” Once you have a plan and know what you can afford, you can get a much better idea of what type of home you can buy and where you can live.
“There are many different ways of doing things that people don’t know about, you just have to know the ins and outs of property,” says Troy. “Through tips and tricks, the right guidance and using the grants in your favour, there are plenty of options available.”
Choosing the right property
When choosing your first home, consider what is most important to you now and over the next five years. Are you looking to be within a short commute to work, or do you want outdoor space? Do you have kids or are you planning to start a family? All of these things, in addition to your budget, will influence where and what you buy.
“Buying your first property isn’t about buying any property, but about buying the right property for the right reason,” explains Troy. “Most people move every seven to nine years, and many refinance yearly to ensure they are always getting the best deals, so the idea of a forever home isn’t as relevant today,” Troy says. “Therefore, your first property purchase is usually a stepping stone to help secure you financially.”
To achieve this security, choosing the right property that will deliver capital growth is critical, and this comes down to research. “Units might be gaining good capital growth in one suburb, yet townhouses are doing better elsewhere. So it’s imperative to research what will be the best property for the best return.”
For many, their first property purchase turns into an investment property. This allows buyers to continue to live and rent in the suburb they want to be in, whilst owning an investment property in a suburb of significant capital growth.
“We have an in-house customer research system that constantly monitors suburb demographics, capital growth and price trends over the last ten years across the region,” explains Troy. “We also track existing and planned infrastructure such as public transport, schools and shopping centres. If property values in one suburb have really taken off in the past five years, we find out why and will research to find out whether neighbouring areas have similar potential. This invaluable research tool helps us to recommend the right property for you and your budget.”
Should I build or renovate?
Though everyone dreams of a spectacular home, the reality is that most families can’t afford their dream home first time around. Those handy at DIY might consider renovating an older-style home. “When budgeting for a renovation, always allow at least 15 per cent on top of your budget for variables, as you often discover many hidden extras when you start pulling the property apart.”
Building a new home means you avoid being hit with additional costs, as the design and complete cost for the build will be established up-front.
“For most young families, building a new house is much more appealing than a renovation,” says Troy. “You won’t get hit with the extra costs that a renovation inevitably brings, and you get a brand new house with a warranty on the construction and appliances. And most importantly, the house is finished when you move in – there’s no living in a building site whilst you try and renovate around your already busy life.”
“Also, if it’s an investment, you can also claim depreciation and negative gearing, so there are lots of advantages to buying brand new that an existing house doesn’t offer.”
That’s not to say there aren’t pitfalls in building either. Choosing the right developer and ensuring you have a fixed price contract to avoid late stage variations can be vital.
“Because the building process can be so daunting, we hold a family’s hand from start to finish,” Troy explains. “Our in-house team will project manage the entire build. From finding the right property, communicating with a conveyancer, through the build and inspections to handing over the keys.”
“A brand new build also means you are eligible for the many government grants available at the moment,” Troy continues. “The jargon can be pretty confusing, so we also help all customers decipher which grants are available to them and help them complete the paperwork.”
You don’t know what you don’t know
There’s so much advice out there about buying your first home it can quickly become overwhelming. And, this abundance of information is not always presented in a way that the everyday purchaser can understand.
“The property market has shown time again that it is the single best wealth creating tool around, but even if you do a lot of research on your own, you may miss out on a key detail,” Troy says. “Our team breaks down what you need to know to make great choices.”
And, with the right planning and support, he believes owning your own home is possible for many of us. “A family paying around $400 per week in rent could purchase a property, and their repayments wouldn’t be much different.”
“All you have to do is tap into a specialist and surround yourself with the right people.”