This has been one of my biggest dreams to own a home. I have known for a long time that I needed this to gain control of my own security, safety and stability. The feeling in this photo was incredible. Auckland is one of the most expensive cities in the world. I had been discouraged for years because of the rising house prices- However, there is hope!
We bought as a couple (splitting the bill is so much cheaper. Also, well done to those who achieved this on your own). We were both very lucky not to lose our jobs during Covid-lockdowns. We went 50/50 and without telling our parents. We did not want to ask for a cent as this was something we wanted to achieve ourselves.
This is how we did it:
Went to random open homes
We knew that we needed to save for a deposit. To make it really happen we starting going to open homes to encourage us to save. I think that is important to envision the future. Manifest it. This allowed us motivation to save, gave us ideas of areas we would like to live in and helped us see a further 5-10 year plan. We were going to houses that were punching 1+ million but it didn’t defer us. Instead we would be like “imagine living here in the next 5-10 years” and “ooooh a granny flat! We could rent that out!”. We knew that we were not going to buy a 4-5 bedroom house with 3 bathrooms and a granny flat but we could dream for the future. We just wanted into the market so that dream would become a reality
First Home Buyer Grant
We bought in March 2020 (the first lockdown). At that time, you were eligible for the grant if you earned under 130k between two people and had been with Kiwisaver 3-5 years. We thought we were cut out of the grant until, I had a brainwave. The grant calculates that sum from your previous financial year. We both earned less the previous year as our scales go up around May-June. We realized we were $2000 under the threshold for 2019 financial year. We applied with a new build home we had an eye on and we got the grant! If you purchase a new build, you can get up to $10,000 per person towards your home. For existing homes, it is up to $5000 per person.
Once you have the grant, you have 6 months to purchase a home with it otherwise you need to re-apply. For us, re-applying was not an option. The rules have changed for 2021- you can find the details here
Thank you New Zealand government for making me put 3-8% of my wages into Kiwisaver! If you’re from overseas, Kiwisaver is a voluntary saving scheme to help save for your first home or retirement. I had been contributing since I was 15 as well as my various employers. My partner has also been contributing to his. We did lose a bit of money during the first lockdown (Funds get invested into shares and the market went down)- I lost about $4000 which I replaced with personal savings. We managed to get a combined total of about $25k to put towards our deposit.
Like the little honey bees we were, we had personal savings. My rule for savings is putting 25-33% of your wages straight into savings when you are paid. We pulled together $17k worth of savings to put towards our $619,000 house (10% deposit $61,900k). Check out my blog 5 Super-Serious-Saving Tips
Grant $20,000 + Kiwisaver $25,000 + Personal Savings $17,000 =
I am not going to lie. There is a lot more that you need to know about the process such as working with the bank, broker, sales/real-estate agent, lawyers and of course your current landlord to make this all happen. We learned along the way. Sometimes, it can seem like an uphill battle and impossible but I am here to tell you that it is possible! Comment below any questions you have!