When many of us imagine owning our first home, those visions usually involve white picket fences and children not yet born, or luxurious penthouses or warehouses in cool inner city locations. Less common is the dream of a one-bedroom unit or a standard family home in the suburbs. However, for the savvy young property investor or first home buyer, the latter is a wise stepping stone on the path to your dream home of the future.
In reality, getting into the property market involves a variety of different versions of what you had imagined, but collectively these choices can produce the same result. Getting some good financial advice can offer surprising opportunities to those not aware of the possibilities for first home buyers to enter the property market.
The first step of course is to save a deposit and get some advice about what kind of mortgage options are available to you. With a clear understanding of your financial options, you’ll quickly discover that property prices in Melbourne and Sydney’s inner suburbs are out of reach for most first home buyers.
Starting with an investment property, a little further out of the action, can help you to at least get into the market, with a manageable mortgage and income from dependable tenants to help pay it down. This will also secure you some equity, improving your future financial options and allow you to upgrade to something you’d prefer, in a location of your choice, with your next property purchase.
Getting some advice from an agent experienced in property investment can help you make decisions about your long-term property investment strategy. With a good rental return and strong potential for increasing the value of your property as your goals, the kind of property you buy and where you buy it are the important decisions. Buying a family house in a residential area, where rental properties are in greater demand will guarantee you a decent rental return. However, some first-time investors prefer lower maintenance, smaller properties to minimise hassle and running expenses.
Property is a good long-term investment and taking a step-by-step approach can yield great results for those committed to the process. Begin by saving a deposit, then get some good financial advice and understand your eligibility for grants programmes and tax incentives. Knowing your budget, you can then shop around for competitive mortgage options and wisely choose the best property option for you as an entry point. The result should be a steady return as the value of your investment property improves and, as a result, better opportunities become available for you to scramble up the property ladder.