When's the right time to buy a house?
NEXT STEP: Lucas Lormans' newly purchased home.
Relevant offers
The great Kiwi property ladder
Seven or eight years ago, as a 20-something, working full-time and very career-focused, I thought the idea of owning a home was far-fetched, out of reach. I was very good at spending money, including that of which I didn't have. I loved to socialise, buy fast, convenient food, and when I wanted something, I got it.
My wonderful wife (girlfriend at the time), however, was focused on getting a house. I told her I thought it was impossible, saving seemed way too hard at that point in my life. But she was convinced, one way or another we had to get into our own home.
Many late night conversations later, we had borrowed a small deposit from a family member ($8,000), and the hunt was on for a property in our price range, which was a very modest $180,000. In Christchurch that meant a small 70sqm unit, albeit in a top location, close to town.
I remember being out for dinner with my father and his boss a year or two earlier and his advice to me is what has stayed with me since: "It's never a bad time to get into property."
This has proved true for us. We bought at the end of New Zealand's biggest ever boom (2007-2008) but got close to the city, in a partially renovated unit. We spent $7,000 on renovations inside and out, then sold for $225,000, three years later. Our main focus was on the outside, with new boundary fencing, landscaping, and a modern white paint job inside.
Taking our percevied profits, we went on the hunt in a market that was now starting to pickup and found a townhouse round the corner in the area of town we now loved, for $350,000. A couple of grand on outside landscaping again, EQC repairs completed, and we sold again approximately three years later for $390,000.
Through this experience the market has seen some significant shifts. The earthquakes changed our entire city's perception. We tried to sell our townhouse in 2012, but being TC3-zoned and the market depressed, we failed to gain any interest. We learnt from this, removed the agent from the equation and tried again this year, selling within 10 days. Previous insight had shown us what we had done wrong, and the market had just become the most active in the country.
The point I am trying to make here is if you are thinking about taking the leap into buying property, but can't decide the right time, the right time is anytime. The market can shift and change in a very short time-frame, and if you look at buying now you will learn what you need to do, how you need to approach vendors and agents, which will put you in a good position for when the right property does come up. Next time you will have valuable experience to draw on and be that much better equipped.
Remember location is everything, and unless you buy something at an excessive amount over its market value, you will never lose money. Small improvements are everything.
We have now purchased, and are waiting to shift into our new family home, which we spent $540,000 on. This will be more of a long-term thing now, however again this has taught us lessons about the market. From the response we had selling our own place, to the action at open homes (30-40 people at every one), we knew it was going to be tough, full of competition. So when we saw the place we liked, we researched, got all of the appropriate legal stuff sorted and went in agressively with an unconditional offer very early. Even doing this three days after it was listed we were in competition with other offers, but secured the house I believe based on being prepared.
All of this I can put down to getting into the property market as soon as I could and learning all along the way.
Stuff Nation Homepage
Sponsored links
Former Black Caps concerned at dangers of crowd catching promotion as NZ Cricket promise review
Why is Wellington's Ngauranga Gorge still an 80kmh zone?
Drivers claim road workers directed them onto challenging Molesworth route as SH1 detour
Kawhia hunter sends farewell text to his wife after stabbing himself in the bush
New Zealand's best undiscovered campground
No comments:
Post a Comment