Mum and Dad’s place is pretty comfy, right? You’ve got your own ensuite, your mates can come over whenever, there are no hangups about boyfriends/girlfriends staying over and having brekky with the fam, you still get Mum’s awesome homemade schnitzels and you can splash your whole wage on a spring racing outfit and a splurge on Strawberrynet. Why in god’s name would you move out and compromise that kind of lifestyle on a mortgage?
I’ll tell you why. Nothing can ever compare to the sense of pride and stability that being able to walk into a home (however large or tiny, manky or swish) that is all yours. Not your Mum’s, Dad’s – not the landlords – not the government’s. Yours. You can paint it whatever color you like. Indulge in the latest trends for wallpapers in elegant flock prints, loads of glitzy girly chandeliers, buy Ikea furniture and deck your joint out like a Swedish dream come true. And no-one can take it from you, or tell you that your taste is shocking. Coz it’s yours.
Sure, in the short term you may not be able to blow as much cash as you normally would at Transport on a Friday night, or buy as many clothes from Cactus Jam as you might like. But when you find that within a year, your net worth has gone up from between 8-10% on your home (and on a 300,000 dollar mortgage we are talking your home being worth another 30 to 40 grand a year) I am pretty sure that the extra security and slush money your home is earning you will make it all worth it. Think about how hard it would be to save 40 grand a year by yourself. It would be almost impossible. When you have your first mortgage, don’t worry about saving too much. Being able to hold onto the first home is the main focus – and you will find that having that home in your name pretty much earns you another passive wage a year.
You can dip into it for a big overseas holiday, an awesome wedding (see mine below with my grannie kicking ass) …. but the most sensible thing to do would be to then use the equity in your home to buy an investment property. None of this passive growth and extra net worth earning happens while you live luxuriously and comfortably with Mum and Dad. So I know it’s a hard habit to kick – but until you do it, you won’t be building much of a foundation to financial security for yourself.
So my hint is: buy yourself a one bedroom unit as soon as possible in Thornbury, Northcote, North Fitzroy, Fitzroy or Preston. It will cost you at the cheaper end $270k and at the pricier $360k. Don’t worry about paying ‘too much’ – at the moment KRudd is still giving you a bit of a kick along, and interest rates won’t be much cheaper than this in the future. One bedroom properties in the inner-north of Melbourne grow wonderfully quickly – and there is always a market to buy these homes upon resale. They are close to public transport and the CBD, often have low body corporate fees (depending on the block), and are always the starting point for generations of first home buyers. Just make sure that you get your finance in order with a pre-approval before you start shopping – you’ll be surprised as how quickly the right home will find you once you start looking.
I can help point you in the right direction of quality one bedroom apartments as well as a few great brokers to get you moving. But the message really is, the sooner you get out there, the faster you will become stable and monetarily creative awesome young people
m)0403 475 919