Sticking to your New Year property goals
It seems to happen faster every year, but there's no denying it – 2016 is well and truly underway. Businesses are back into the full swing of operations, kids are returning to school, and if it's anything like last year, the annual goals of some people are already beginning to fall by the wayside.
In fact, according to Finder, 58 per cent of Australians broke their New Year's resolutions, with 15 per cent had already broken them just three months in. While this traditional goal-setting time of the year is generally a light-hearted affair without any major consequences for non-compliance, for some people the setting of resolutions can lay out their plans for certain aspects of their life.
Perhaps you were amongst those who set property goals for 2016, so now might be a good time to take stock with how you've started out. Maybe this is the year you are planning to buy your first home, upgrade your current housing situation or even speak to a buyer's agent about building your own existing property portfolio.
Whatever your goals, checking in on your progress regularly is a great way to stay focused and headed in the right direction.
The unchanged cash rate continues to support the cooling of the nation's housing markets, especially in our two largest cities.
How has the market started the year?
The year's first major announcement of concern for property buyers has come and gone, with the Reserve Bank of Australia (RBA) opting to, once again, leave the official cash rate on hold at 2 per cent. In his media release, RBA Governor Glenn Stevens noted that the unchanged rate continues to support the cooling of the nation's housing markets, especially in our two largest cities.
"Credit growth to households continues at a moderate pace, albeit with a changed composition between investors and owner-occupiers. The pace of growth in dwelling prices has moderated in Melbourne and Sydney over recent months and has remained mostly subdued in other cities," he said.
Industry experts were quick to comment on the RBA's decision, with CoreLogic RP Data Head of Research Tim Lawless predicting that the stabilisation of median house prices could even pave the way for a further rate cut this year.
"With heat in the housing market no longer likely to be a major concern for the RBA, a major obstacle has been removed from preventing rate cuts and we may see the cash rate move lower," he said.
What does this mean for home buyers?
With the RBA's lower interest rate apparently taking the steam out of the real estate market, it's a good time to talk to your buyer's agent about starting your property search. However, it's important to keep a close eye on your financing options, as Australia's big lenders last year showed that they are willing to change their mortgage rates independently of the RBA.
Taking a broad view of the home loan market can save you thousands.
Shopping around for housing finance can be time consuming, however smaller lenders or mortgage managers may be taking advantage of the big banks' unpopular rate rises to attract new customers with better options. Whether you decide to go it alone or bring in the expertise of a broker, taking a broad view of the home loan market can save you thousands.
If you are hoping to become a homeowner this year, there is still plenty of time to achieve that goal. So how can you make sure you stick to your savings pattern to help you along the way?
Little changes can add up to big savings
A survey from Westpac has found that improving financial fitness is the highest priority for Australians in 2016, with 69 per cent of respondents saying they wanted to save more money in the new year. The national average savings goal lies at $11,234, with 40 per cent specifically stating that money would be put towards a home or home improvements.
Making huge changes to your lifestyle and spending patterns can be incredibly challenging, something you can only do in very specific circumstances. That said, the impact on your savings from little changes here and there can have a great cumulative effect, and you might be surprised just how much of a difference tightening up in small, day-to-day areas can make.
The 2013 National Office Workers Survey found that Australian workers were spending on average $200 per week at work. That means things like food and beverages, lunchtime shopping trips and drinks at work functions. If you think you might be part of this group, is it possible that you could cut some of this expenditure out in the interests of hitting your savings targets?
Let's boil it down to one individual expense – coffee. The Cappuccino Price Index (a measure of average prices) states that the average price for a single cup of coffee in Australia is $3.62. That may seem like an insignificant amount at the individual level, but expand that out to a week, and that goes up to around $18.
Again, not a particularly dramatic amount. Tally that up over 52 weeks for the year, however, and it's you're looking at $941. If your personal savings goal is $10,000, for example, almost 10 per cent of that could be accumulated simply by cutting one cup of coffee out of your day. It's these apparently insignificant cuts to your regular spending that can make all the difference when it comes time to secure your housing finance, and approach a buyer's agent for assistance finding a property.
Make yourself accountable
It may seem a little gauche, but research has shown that sharing your goals and progress publicly actually makes you more likely to achieve them. Speaking to Fast Company, psychologist and author Elizabeth Lombardo notes that with no one around to push you to do things you are neglecting, it becomes easier to let things slide.
However, if you publicly announce your intentions, whether in person to friends, family and colleagues or over social media, it can help motivate you to stay on track, in order to save face in front of others. Similarly, sharing when you achieve or make significant progress your goals can result in more encouragement and support, good vibes which can further reinforce your dedication.
The secret is having the inside track on the property market and knowing how to source a good deal.
Whatever technique you use, learning to stick to your savings plan can see you into your first home sooner, and can continue making your life easier right throughout your mortgage repayment schedule.
Know how to find the best deals
Once you have achieved your savings goals (you will – think positive!) and secured your housing finance, the next trick is to find your dream new home or investment property. A great secret is having the inside track on the property market and knowing how to source a good deal.
That's where Cohen Handler comes in. Our buyer's agents have deep ties to the real estate industry in Sydney, Melbourne and Brisbane, and their network of connections can offer access to off-market properties before the wider market has a chance to see them, potentially saving you many thousands of dollars.
Saving for a new home can be a huge battle, so make finding that home as painless as possible – speak to the experts at Cohen Handler today.