New statistics have shown that a growing number of Australians are preferring to rent than buy.
According to financial comparison site finder.com.au, 32 per cent of Australians would prefer to rent than buy – up from 10 per cent this time last year.
In addition, a further 14 per cent of Australians said it was easier for them to continue living with their parents rather than attempt to buy a property – up from 10 per cent last year.
This data comes at a time when interest rates are currently sitting at record lows and Australia's lenders have proven themselves to be hungry for business.
Of course, while mortgage rates are now at all-time lows, property prices continue to rise, with many of Australia's capital cities recording a significant spike in dwelling values over the last 18 – 24 months.
Over the last 12 months alone, Sydney values have soared 13.7 per cent – forcing many potential first home buyers to continue renting or living with their parents.
So what can first home buyers do to help themselves escape the rental trap?
The first thing all first home buyers can do is step up their savings. With 100 per cent home loans now firmly a thing of the past, first home buyers are required to have a deposit of at least 5 to 10 per cent in order to help them obtain finance.
Of course, with the cost of living ever rising, saving money is often harder said than done. The good news is, it doesn't have to be difficult. There are plenty of things potential first home buyers can do to kick their savings into gear, including:
Become a VIP member
It may sound cheesy, but these days a lot of retailers – including supermarkets - have VIP clubs. By becoming a VIP member, you will receive significant discounts and savings on a raft of items such as a few dollars off a movie ticket or discount vouchers.
Create a savings plan and ask someone to hold you accountable. If you know a partner, sibling or friend is going to jump down your throat if you don't make good on your savings plan, you will be more likely to make things happen.
Home cooked meals
Rather than buying your lunch each weekday, why not prepare your own meals by making a weekly trip to the supermarket. A savings tip is to write a shopping list (like your mum probably does) and always make sure you go to the supermarket with a full stomach – if you are hungry to begin with, you may buy more food than you need.
Waste not, want not
Eliminate some of the little luxuries that you can do without. Try cutting back on takeaway coffees, fashionable items that have a short life-span, pay-television, internet or data usage etc. You could even change your social plans and invite friends and family to get-togethers at your place rather than going out where you will be tempted to spend more money.
Do it yourself – Instead of regularly paying somebody else to clean your clothes, wash your car, style your hair etc., try taking time out to do these things yourself and save money in the process. After all, every cent counts in your savings plan!