4 Steps to help you crack the property market in 2018

If 2017 favoured the investor, 2018 is tipped to be the year of the first home buyer.

 

How can you break the property market this year? We give you the tips to ensure you can get your home and have your avocado too.

 

Step #1: Pay down your debt

Let’s get real, if you’re ridden with debt, it’s unlikely you’re going to be able to save for a home. Reducing any debt – from personal loans to credit cards – can help you in more ways than one before purchasing a home. It puts you in a better position as a borrower when you apply for a home loan, as lenders will assess you on a range of factors and your debt level is one of these.

It’s simple: The less debt you have, the better position you’ll be in financially.

Step #2: Budget to save

When saving for a deposit, it’s crucial to not only pay down your debt but to have a regular savings plan.

Unfortunately, saving a deposit doesn’t happen by accident – you need to be organised and consistent. And the first step is to look at your finances and work out a budget. Budgets help you identify where your money goes in any given month and where you can make small cost-cutting measures. This will allow you to have a realistic idea of how much you can put away every week.

Step #3: Fast-track your savings

Debt-free and fancy free? Not a chance.

Once your hard-earned is going into your bank account – not your credit card – it might be tempting to spread your wings a bit. Don’t. It’s actually a much better time to start building up your genuine savings. Use designated savings channels such as high-interest savings accounts and term deposits to help you.

These accounts are intended to boost your savings by offering interest on the money you hold in them. And unlike everyday transactional accounts, these products generally have no account keeping fees. A term deposit also provides the added benefit of locking away savings for a specified term, meaning you’re less likely to dip into your savings for impulse purchases.

If you’re looking to build a deposit for a home, these types of products make your money work harder by earning interest on your savings, helping to boost it more quickly.

Not confident you’ll remember to regularly deposit money into a savings account? You could always look into setting up a direct debit from your everyday account to your savings account.

Step #4: Check your credit score

For those not aware, a credit score is a number that is calculated based on the information in your credit reports that lenders will use to determine your reputation as a borrower. The higher your score, the more attractive you seem to potential home lenders when applying for a loan. Lenders (may) use this information to decide if lending you money (to buy a home) is worth the risk.

Things like the type and size of credit your request, paying bills on time, paying off outstanding loans and credit card debt, employment history and not having too many credit cards can all impact your overall credit score.

If you haven’t ever looked up your credit score, now is the perfect time to do it. You’re entitled to one free copy of your credit report every 12 months from each of the three nationwide credit reporting companies, such as Equifax, Dun and Bradstreet and Experian.

If the number comes back high – congratulations. You’re one step closer to that #dreamhome

The team at Professionals Padstow are more than happy to help and discuss any of your property queries, particularly to first-time buyers, so please contact them and they’ll be sure to help you in any way. If you have any tips for property buyers or property owners on how to save for their #dreamhome, please share your feedback over at I Love Padstow to Picnic Point Facebook page.

 

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