• Many people today are commenting that they will never own their own home.  This is far from the truth.  There are many ways to enter the property market and for people to buy their first home.  Preparation is the key.  There are 3 major areas that the lenders will look at.

1.  Your credit status.  This is how well you operate your accounts and honour your financial commitments.  Our advice is to keep your accounts looking perfect ie don’t go over your limits and pay all your debts/accounts on their due date
2. Your deposit – the more deposit you have the more options you will have.  Your Kiwisaver can be accessed for the purchase of your first home.  If you are employed your employer must also contribute so we recommend having a Kiwisaver plan in place.  You can increase your Kiwisaver contributions to whatever level you want.  If you are self employed you can still contribute to Kiwisaver.  You can build up savings.  You can sell assets. 
3. Income vs expenses.  the lenders want to see that you have sufficient income to service not only the outgoings of the new house but also your living expenses.  so try to keep expenses down and use any surplus funds to build up your deposit.  Avoid other credit facilities such as credit cards (unless you clear them every month).  Keep debts to a minimum (preferably nil) eg hire purchase, car loans, buy now-pay later (eg Afterpays), overdrafts etc. the more debt you have the less options you have

It is never too early to seek advice on how a first home buyer can prepare themselves to get in to the market.  Our recommendation is to consult a home loan advisor to accurately identify the opportunities and ways to overcome challenges that are particular to your situation and requirements.    

This post was written by

Trish Marsden - who has written 6 posts