Monday, July 18, 2016

24 tips for buying your first home

1. Skip buying your first home, which is clearly impossible, and move directly into buying the second or third.

2. Attend every open home in your preferred area. Once you have found one you really like in somebody else’s price range, sit down at the kitchen table and refuse to leave.

3. Stop buying coffee out. In no time you'll be able to afford a home in the $4.50 to $9.00 range.

4. Cancel your Sky Television subscription. This won’t really help you buy a house, but is a good idea generally.

5. Go to the Treasury with a recording of the Q&A programme in which the Finance Minister claimed that first home buyers wishing to get into the property market 'need to have patience'. Proceed to demand that your vast store of patience be converted into the deposit for a median price home.

6. Build a relationship with your bank, to show them you're a committed saver and a good risk. Show up with flowers or a small gift. Put out every once in a while.

7. We’ve all been at a party where someone boasts that they bought a house in need of major work and then flicked it off for a massive profit after some minor cosmetic renovations, but sometimes at the end of the story we have neglected to punch them in the face.

8. Try harder to save. If you put away just $5 a week for a year, you’ll be able to rent a getaway car with which to rob your nearest bank.

9. Consider buying a property that is able to generate its own cash flow to help with mortgage repayments. Remember that when the ad says “home plus income”, it means you can easily find room for a methamphetamine lab.

10. Be prepared to make sacrifices. If necessary, become a druid.

11. Lower the price of a house during a public visit by making derogatory comments about the quality of the fittings, or periodically shouting ‘Is this the room where all the murders happened?’

12. You may have heard that Auckland's stratified median house price rose NZ$40,737 in the month of June to That's NZ$1,358 per day or NZ$57 per hour. At those rates of increase, consider that you would not be owning a house. The house would be owning you.

13. Be like young Auckland homeonwer Gary Lin, as featured in The New Zealand Herald, who said: “Work hard, work smart, save hard, and invest smart. Wealth creation is not rocket science - perseverance and hard work can get you there." Mr Lin bought his first property in June 2010 with a $200,000 wedding gift from his father.

14. If you can’t be born into a wealthy family, ask yourself: can you marry into one?

15. Be like young Dunedin homeowner Ondine Grace, as featured on the Sorted website. Among the stratagems she employed to accumulate the deposit for a house, Ondine lived with her parents and avoided drinking alcohol, which saved a lot of money. And if she did it, you too can move in with Ms Grace’s parents.

16. Be like Renee Van Veen, 27, and Kurt Jameson, 29, as featured on the Stuff website, who refused to be defeated and forked out $785,000 for a three-bedroom home on a cross-lease section in Unsworth Heights. Their mortgage is very large but at least they now have a foot in the door, slowly getting crushed.

17. A home in Mangere, council valuation $1.2 million, sold over the weekend for $4.7million. This is not a tip for buying your first home, I just wanted to see you cry.

18. Know how much you can afford. If the answer is “not a home”, try to put this fact out of your mind.

19. Attend a first-time home buyer's seminar. This won’t help you buy a house, but tea and coffee at these events are generally free.

20. Okay, you may never own your own home but on the plus side you have very beautiful eyes.

21. Have you ever heard of “negative gearing”? Me neither.

22. Have reasonable expectations. Peter Thompson, the head of Barfoot & Thompson, said young people needed to change their mindset because their suburb choice, size of the house and its amenities or desire to own property within a normal human life span were often totally unrealistic.

22b. Here’s a test to assess whether your expectations are too high. Look at the recent, actual 'for sale' ad below.

If you reaction is “Why are you showing me pictures of a dungeon?” it means your expectations are too high. If your reaction is “This house is no longer on fire, I’ll take it!” it means your expectations are realistic.

23. Remember, you're not buying your dream home, you're getting on the property ladder. The constant supply of people sufficiently desperate to get onto the ladder is essential in order to keep people like Peter Thompson, the head of Barfoot & Thompson, in the lifestyle they’re accustomed to. And this is what is truly important.

24. Finally, recognise that this isn’t a generational war, but an old-fashioned class war that just so happens to coincide with a periodic downward revision of the social contract and of the economic expectations for ordinary citizens entering the work force – be they whether they will own a home today or receive a pension in forty years' time. Organise with other people in your situation, agitate, demand profound and lasting political change.


Ray said...

Or you could buy a home in my hometown where an ex state house costs about $150,000
Plenty of work for those prepared to that.
Turkish, Chinese, Malasian and good Kiwi food.
People who care.
Downside, having to wave to people all the time when out walking, 30 second wait on the corner of High and Queen street at rush hour.

Giovanni Tiso said...

Some small towns have some jobs, which is not to say people can just move there and take those jobs if it's not what they're trained for, or if it isn't a place where their partner can also work. Big cities is where most jobs that people can actually do are.

Anonymous said...

Yip, living in a rural village is a luxury of scenery, clean air, beauty, and, the people are nice.......but, very few job opportunities..... And a few hours from Mitre 10!!

happy today said...

But if you have a deposit and can get a job in a small town to service the mortgage, perhaps your partner (male or female) won't need to work and can look at tertiary education, part-time work, raising a family or volunteering in the community (fire service, coastguard, ambulance, etc). Some 3 bedroom houses in NZ are less than $100,000. Even if you take the maximum term of 30 years, you can pay it off sooner once you get established.

Diogenes said...

Or buy a house in a small town twenty ks inland on a coastal plain and wait for global warming to turn your property into a desirable beachfront residence and your small town into a bustling new port city.

Giovanni Tiso said...

Shannon already has a sign that says welcome to Shan Francisco and strikes me as the perfect candidate.

Chrissy said...


Unknown said...

Fred Dagg on Real Estate. this was done in the 1970s but is still mostly appropriate.

Sarah said...

Giovanni, do you mind if I share this with with Waikato University's Environmental Planning facebook page?

Giovanni Tiso said...

Of course I don't! But thank you for checking.