The dream of home ownership seems to be getting further away for many young people, with Australian Bureau of Statistics figures showing that the age of an Australian first-home buyer just keeps going up.
In 1996, 13.2 per cent of first-home buyers were aged 18 to 24, but in 2018, only 3.1 per cent of people in that age group closed on a first property. However, young buyers are still out there, signing on the dotted line and getting ready for a landlord-free life.
Meet three young Canberrans who all exchanged on their own place before their 25th birthday. None of them had a trust fund or a large deposit from their parents. For anyone who is stuck living at home or renting a shoddy apartment and wondering how these women did it, they have one answer: insider knowledge.
Emily exchanged on her first property at the age of 22. She wanted to live near the city and was lucky enough to score a top-floor unit in an off-plan development in Dickson.
“I never wanted a garden,” she says. “I knew I wanted a central location so an apartment was ideal. Most of my friends rent, but because I work in real estate, I saw the positives of being a homeowner.”
Being young, Emily didn’t have a huge stash of savings for a traditional deposit.
“For most properties, you need at least a five per cent deposit,” she says. “For this property, that was $21,000, which I didn’t have. But because it was off-plan, I could secure my unit with a $2000 holding deposit and then have another few months to come up with the five per cent.
“Now that I’ve exchanged, I’ve got a lot of motivation to save. My goal is to have the whole 20 per cent deposit before settlement so I don’t have to pay mortgage insurance.”
Emily’s job also helped her zero in on exactly what she wanted.
“When I started looking, I remember thinking I wanted a development with a pool and a gym,” she says. “But because of my job, I knew those things mean higher strata fees. So I chose somewhere that would have lower ongoing costs. My plan is to eventually upgrade to somewhere bigger and keep this as an investment property so I chose a location I knew has good rental yields, great amenities and is attractive to tenants.”
Tammy wasn’t working in real estate when she exchanged on her property at 23 years old, but her Dad was.
“My dad is an agent so he found a place for me and said if I didn’t buy it, he would,” she says. “I knew he wouldn’t steer me wrong, and that gave me more confidence than I would have had otherwise. As a first-home owner, you don’t really feel like you know what you’re doing so having that inside knowledge helped a lot.”
Tammy, who now works as a property manager, considers her ground-floor apartment to be the best decision she’s ever made.
“I moved into my place in 2017 and now I have $100,000 in equity,” she says. “I’ve even been able to save. I’m looking at townhouses now so I have more space. I wouldn’t have been able to do that as a 28-year-old if I hadn’t already got on the ladder.”
Holly was even younger when she took on the title of homeowner. At just 19, she’s exchanged on her first apartment, a one-bedroom unit overlooking Parliament House. Even better, she’ll be able to get the $25,000 HomeBuilder grant when she settles in 2021.
“I had some money saved up because I was planning to go travelling,” she explains. “When COVID-19 hit, obviously that was off the table so I thought, ‘What else can I do with this money?’ Because I work in real estate, buying a property seemed like the obvious answer.”
Holly bought off-the-plan with a small deposit that her savings more than covered. With another nine months to come up with the balance to take it up to 10 per cent, she’s feeling like she’s got this.
“I’m really loving the idea that I’ll have my own space, and my own little bubble where I can do what I want,” she says.
Visit Independent’s First Home Buyer page to find more insider information to help you buy your first home.
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