Don't Let Your New Home be a House of Cards

If you’re planning to buy property this year, you need to be aware to not fall into the trap of dropping the financial ball after the initial thrill of your purchase.

Too often we hear about first home owners getting into financial difficulty because they want so many of the things that go with a new home, such as new furniture and a lifestyle to suit, without having the patience to wait until they can comfortably afford them.

Avoid your new home purchase becoming a house of cards by adopting the following principles:

1. Keep loan and credit arrangements to a minimum and refuse new offers of additional credit.
2. Try to use cash for all discretionary spending.
3. Keep a rainy-day buffer in your budget for any unforeseen expenses, as well as the time when your mortgage repayments may eventually increase.
4. Only spend money on essential repairs to your new home and use the relevant skills and assistance of friends and family if necessary where you can to fix a problem.
5. New furniture is not essential in a new home. Look instead at second-hand furniture, often found at charity shops or council throw outs, or opt instead for a minimalist look and acquire things as you can afford them.
6. Holidays are not a holiday from financial obligations. Stay-at-home vacations are becoming increasingly popular in achieving down time, without the financial burden of having to travel anywhere to get it.
7. When you plan to catch up socially with your friends, entertain at home - and keep the rules simple by asking everyone to bring a plate.

To find out more about your home loan options, call resi 136 126.

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