Owning a home has long been considered part of the “Kiwi Dream,” but for many New Zealanders, the path to home ownership can feel challenging and overwhelming. To help you prepare for home ownership, here are 5 important steps you can take, starting now.
1. Determine Your Budget
Review your budget carefully, including your income, expenses, and any existing debt. Use online calculators to estimate your home loan repayments and consult with a mortgage adviser to get a clearer picture of your financial position.
2. Find Your Deposit
Most lenders require at least a 20 per cent deposit, although some may accept a lower amount. Your deposit can come from a number of sources including personal savings, KiwiSaver withdrawals, and financial assistance from family or friends.
3. Pool Your Resources
Consider pooling your income and deposits with friends or family to boost your buying power and get into the property market sooner. Sharing financial responsibilities can make home ownership more affordable, but it's essential to have clear agreements and seek legal advice to ensure everyone's interests are protected.
4. Get Pre-Approved Finance
Home loan pre-approval is an agreement from a lender of the amount they’re willing to lend. Not only does this give you a clear indication of your borrowing capacity so you don’t waste time viewing properties you can’t afford, but it can also make you a more confident and competitive buyer.
5. Get the Right Team on Your Side
Work with a mortgage adviser to get valuable insights into the best strategies for saving a deposit, understanding lending requirements, comparing home loan options, and effectively structuring a mortgage. Consult with a Harcourts Sales Consultant to get an insider’s perspective on current market trends and property sales data.