When you're buying your first home, you want a place to live you can call your own. Sometimes that might not be your dream home, but it could be a "stepping stone" to something you've always wanted.
At My Mortgage, we often talk about making a plan that will be best for you in the long run, and putting you in the best position we can long term. Part of that is to make a plan for you for the next 2-5 years, ask you about your financial goals and what you'd like to achieve over that time.
It's super important to us.
Take Jake and Laura for example. They are 23, and earn $50K and $43K respectively. They have saved hard over the past 3 years and have savings of $49K along with Kiwisaver of $14K, and they are also eligible for the Home Start Grant of $7K combined. Their total deposit is $70K.
They want to find some land and build a small house in the Waikato, but they are struggling to meet the total project cost of a new build within the Home Start Grant cap of $450K. After some lengthy discussions about the best way forward, we suggested a 5 year plan to achieve their goal.
Year 2 & 3:
Year 4 & 5:
You can then pay down your home loan and continue to build some equity by landscaping your Stage 1 home and continuing to save. At the end of Year 5 the goal would be to have realised another gain of $40K so you can build Stage 2 for another $200K and get to a finished home with good equity and a final home loan of a maximum of $600K (or less).
This allowed Jake and Laura to still keep their dream of building a home, but by putting a clear plan in place, and getting them on the property ladder, now, we have created a better long term outcome.
Adam and Claire are happy to sit down and discuss your situation, and make a tailored plan for you.
Putting this plan in place now will make a massive difference to achieving your financial goals long term.Your first home might be your forever home - or it could be a key stepping stone in your long term plan. Let us help make it a reality for you!