Staying in the nest to fly the coop By Madelin Hayes
Many young adults are reaping the savings benefits of moving back into the family home – that’s if their parents haven’t already converted their childhood bedroom into a gym, private yoga studio, or storage room.
With a never-ending list of expenditures such as rent and bills, it can be difficult to save for your first home.
For first homebuyer Holly Coomey, living in the family abode for longer was the most viable option for saving.
“I considered moving out into a share house a few times but I figured it was more comfortable to live at home, along with it being cheaper,” she said. “I contributed a bit, but obviously I was able to save the majority of my wages.”
After spending a year shopping around for her dream home, Ms Coomey settled for a four-by-one in November last year.
“I put offers in on a couple of houses but they fell through and then this one in Hillman popped up,” she said.
“As soon as I walked in I just knew it was my home, even though it was old and the paintwork was terrible, I just loved everything else about it.”
While some might cringe at the thought of moving back in with their folks, Marron Real Estate Principal and Licensee Rhett Marron said it was one of the best ways to save for your first home.
“Making contributions towards household costs in a family home are still likely to result in much better savings than renting from a landlord,” he said.
“When I was younger it also resulted in my mum doing my washing which was much better than the financial savings I made.”
Mr Marron said the first homebuyer market had experienced a fair bit of upheaval in recent times, with the initial boom in government grants in the early days of the pandemic leading many to build their first home, and the current constricted market now causing a shortage of properties and rising prices, leaving first homebuyers with few options.
“Because wages growth has not followed the increase in property prices, I’ve found first homebuyers are generally older and have become too independent to move back home in order to save,” he said.
With skyrocketing rental prices, Mr Marron said more tenants were taking the leap into homeownership.
“The significant shortage of rental properties – partially due to people returning to Western Australia – has seen a dramatic increase in rental rates,” he said.
“A lot of the first homebuyers I have spoken to have realised there isn’t a lot of difference between their current rent and loan repayments and, for them, it makes better financial sense to stop renting and enter the property market.”
Whether you’re thinking to return to the comfort of your family home or stick it out in a rental while you save, Mr Marron said it was important to regularly search for competitively priced properties and government grants.
“Actively looking for government grants and assistance packages, which change regularly, can prove very helpful in the quest to buy your first home,” he said.
“For example, the recent building and renovation grants caused a huge spike in activity in the building industry because the grants were of such an amount that it gave people the ability to afford to build when, without the grants, they could not.”
In order to make significant contributions to your savings, Ms Coomey said it was important to re-evaluate your spending habits.
“Live as minimally as you can, don’t buy unnecessary things that you have at home already,” she said.
“It’s the same with memberships and subscriptions. People spend so much money on those, especially if you’re not using them.
“It seems like a chore to cancel them, but it will save so much money in the long run – you just have to be disciplined.”
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