There was once a time when a family could easily buy a car and home on a single income, and still keep a healthy amount of savings. Unfortunately, that is no longer the case, and a lot of us only have that single income to rely on. While it may seem like an insurmountable goal to purchase property on a single income, there are many strategies and tactics you can still use to make big moves in your first foray into the real estate market.
To get things started, you naturally first need to ask yourself a few questions, like ‘What kind of property do I need?’ or better still, ‘How much can I borrow?. But there is a lot more that must be looked at before signing sale contracts on any property. With the cost of living steadily on the rise across the globe, it might take some strict budgeting and planning to help you feel more confident as a prospective home buyer – not to mention some outside-of-the-box thinking. But with the right approach, there’s no reason that you can’t become a homeowner.
Let’s take a look at six useful tips that can help you to become a homeowner, even if you are on a single income.
1. Tighten Your Belt
Yes, this may sound like an obvious tip, but it needs to be taken into account. Tightening your belt means tracking and understanding where every cent you earn goes each month. A lot of people don’t keep a detailed monthly budget, but doing so can bring many advantages. Start tracking everything you spend, as you need to know exactly where you stand at the end of the month.
If you can get to the point of having a full monthly budget, it makes it much easier to start getting rid of extra expenditures, and seeing real results from your efforts. It will take a lot of determination and focus, but following this one tip will be essential in achieving your goal of purchasing a home.
2. Save Money Wherever You Can
Now that you have a budget that shows you exactly where your money is going, it is time to get rid of expenses that are particularly costly or wasteful. Only you can decide what things can go from your budget, but typical things like take-out coffee and food, theatre trips, and other unneeded expenses are usually the first to go.
You can also save a lot of money simply by planning your spending each week. Weekly flyers, coupons, and other discount offers are there for a reason, so take the time to scout out good deals. With a bit of strategic spending, you can see your grocery costs decreasing with every passing week.
3. Consult With A Financial Professional
If you are still struggling to balance everything to afford a house, it may be time to consult a professional money manager. If you go into your appointment with some clearly defined financial goals, it’s highly likely that your selected financial planner will be able to work with you and set you on the path to home ownership. And while consultations with these specialists may add to your monthly expenses, it may be worth the budget hit to get some premium advice on your unique financial situation.
4. Keep it Small
With the prices of virtually everything being well and truly on the rise these days, it is almost a no-brainer that you keep your home purchase as small as possible. Not only will you be able to afford a smaller home a lot faster and with less time investment (in fact you could already have an adequate deposit for a smaller property right now), but buying small to begin with will also come with less maintenance worry and fewer property taxes each year.
No one is saying to opt for one of those tiny homes, but if you keep things small, you will be in a much better position financially moving forward – especially if you’re managing a single person household.
5. Don’t Be Scared Of Unconventional
There are a lot of people living in unconventional situations these days, as technology really has allowed for some unique living opportunities, to say the very least. If you are open-minded, you may have some out-of-the-box options for homeownership, as long as you don’t mind something different. Some people are making homes out of shipping containers, others out of old boats, and everything in-between. And some are opting to rent out granny flats rather than take out a lease for a home or apartment, allowing them to save big on rent while they build their deposit for a home loan. As long as something is legally classified as a home, and you feel like it works for you, don’t hesitate to put your signature on it.
6. Co-Ownership Is Growing
Younger generations are starting to understand that the dream of homeownership is getting more difficult, and they have decided to do something about it. People buying homes together, as friends, is becoming far more common, as it allows people to split the costs. If you have a friend in a similar situation, it is worth weighing the options of co-ownership, as it increases your purchasing power and the ability to qualify for financing with the lenders of your choice.
Find Your Perfect Property, Even On A Single Income
The traditional family home does still exist, it is just not as attainable as it once was. However, you can’t give up on your dream and let changes in the world economy stop you from having your own home, it just means you have to do things a bit differently and work a little harder. Whether you decide to purchase a home that is unconventional or co-own with a friend, there are options out there for single-income people and families to find their perfect property and build a home that is right for them.
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