Here are our top 6 tips to help you tackle the deposit saving challenge and get closer to your dream of home ownership.
1. Do your research
Before you get started, gain a clear picture of your current situation and future goals.
For example, it is recommended you consider the following:
After some initial research, it is a good idea to meet with a mortgage broker to help you determine your borrowing power and the home loan products that might be suitable for you.
While a 20% deposit is often considered ideal giving you access to a broader range of home loan products and helping you avoid paying Lenders Mortgage Insurance (LMI), there are also low deposit home loan options available. At Cedar Woods, deposit requirements vary depending on the development and the type of property you're purchasing. For instance, at Fletcher’s Slip, you can secure an off the plan townhouse with just a $10,000 deposit at contract signing, followed by progress payments during construction. Meanwhile, at Glenside purchasing an off the plan apartment requires a 10% deposit at contract signing, with the remaining balance due at settlement.
Your broker can work with you to find the right solutions for your unique circumstances, explain how different loans work and their features, and support you throughout the process from application through to settlement.
3. Get a helping handTo help you get started on your property journey sooner, you may be eligible for Government grants and incentives. If you're a first home buyer, you may be eligible for a range of Government grants and incentives that can significantly reduce your upfront costs. For example, when purchasing an off-the-plan property, such as a modern townhouse at Fletcher’s Slip, you could access the First Home Owner Grant of up to $15,000, along with potential stamp duty exemptions. These savings can make a real difference in turning your dream of home ownership into a reality.
We have put together a handy eBook especially for first home buyers with everything you need to know about financing your first home.
4. Set SMART goalsResearch shows that having a specific goal to focus on increases our chances of success, and writing it down boosts our chances by more than 30 per cent*.
When setting your money goals, it may help to follow the SMART goals theory – ensuring your goal is Specific, Measurable, Achievable, Relevant and Time-bound.
To determine your SMART deposit savings goal, remember to factor in not only the home deposit but also the associated costs of purchasing a house, which may include stamp duty and moving costs.
5. Get budget savvyTo boost your savings potential, review your budget and get ruthless. Look for anything that you may be able to cut from your budget, as even small changes can add up over time.
Maybe you have six different streaming services you don’t need, a barely used gym membership, or can reduce your takeaway meals.
Rather than looking at it as going without, remember the bigger picture. Budgeting will not only fast-track your deposit savings, it will also set you up to manage your home loan repayments and costs of home ownership in the future.
6. Bring your bills downSaving your home deposit is a big task but keeping focused and taking steps towards your goal are key to long-term success.
Eager to research more about buying or building your first home? Download our handy First Home Buyer eBook which will help you understand what is next.
* Matthews, G. (2015). Goal Research Summary. Paper presented at the 9th Annual International Conference of the Psychology Research Unit of Athens Institute for Education and Research (ATINER), Athens, Greece.