Rising property prices are forcing Victorian first home buyers to save for longer than ever before in order to get their foot onto the property ladder.
According to Mortgage Choice’s latest First Home Owner survey, which canvassed the opinions of more than 1,000 first time buyers who had purchased within the last two years, 29.6 per cent of Victorian first home buyers said they had saved for “more than five years” before buying their property.
By comparison, research conducted by Mortgage Choice in 2011 found 51.3 per cent of Victorian first home buyers saved for “less than two years” before buying their property.
It isn’t surprising to see first home buyers saving for longer than ever before as property prices are climbing at an impressive rate.
Research from RP Data shows property prices across Australia’s combined capital cities have climbed 10.9 per cent over the 12 months to September.
Victoria’s capital city Melbourne has enjoyed a stellar year in terms of price growth, with dwelling values climbing 8.1 per cent in the 12 months to October 2014.
Of course, while some buyers may benefit from this surge in prices, this significant uptick in values has forced first time buyers to save for longer and, in some instances, stopped them from buying exactly where they want to.
For those first home buyers who would like to save more money at a faster rate, we offer the following sneaky savings tips:
- Keep a look out for a better deal: Have you kept your money with the same lender since you got your first job? If the answer is yes, then it may pay to look around and consider switching to another bank. Not only are some banks offering dollar incentives –such as $100 into your savings account – if you switch, but they also have high interest rate savings accounts, which will help you to earn more money on the cash you have in your savings account.
- Read the fine print: If you do switch lenders, make sure you read the fine print, as you may find that your lender will offer you dollar incentives for depositing a certain amount of money into your account each month or withdrawing a certain amount of money from the ATM each time. What have you got to lose?
- Know what you want: Writing a shopping list before you buy groceries may sound like an oldie, but it is a goody. Writing a grocery list and eating a snack before you hit the shops will ensure you don’t buy things you don’t need.
- Turn your trash into treasure: Have you ever heard the saying: ‘one man’s trash is another man’s treasure’? Well, it’s true. There is always going to be someone willing to buy your old clothes, shoes or even appliances. So next time you give your wardrobe a clean out, don’t throw the stuff you don’t want away, sell it on eBay or set up a stand at the local markets and sell it to the people in your neighbourhood.
- Put your hand up: Finally, it doesn’t hurt to ask for discounts. Have you been a member of your local gym for some time? If so, it may pay to give them a call and see if they can reduce your weekly fee for being a loyal customer. The trick is to ask for a discount wherever you feel comfortable. After all, you don’t ask, you don’t get.