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We’re being inundated with enquiries from first homebuyers at the moment, who are all keen to take advantage of record-low interest rates to get into the property market. 

With mortgage rates so low, it’s a great time to think about buying a home, and at Zippy, we love the opportunity to help everyday Australians reach their dream of owning property. 

But we’re finding a recurring theme with the first home buyers who are coming to us right now – and it’s holding them back from getting started. 

Taking your first step on the property ladder 

It reminds me a little of leaving school. For some people, the path after high school leads to university. And sometimes, people can have an expectation that they’ll graduate, swiftly land an executive job and start earning six figures from day one. 

The reality isn’t quite like that. You have to start somewhere. Usually, you start in a junior role, learn about the industry and work your way up. Then, as your knowledge and experience grow, your climb your way up the career ladder.  

Some people may be able to skip some steps and take a different path. But for the majority of us, this is the recipe to career success: hard work, grit, determination, and time.  

The same philosophy applies to buying a home. Unless you have a hefty inheritance or financial gift to give you a leg up, saving a deposit to buy a home in a city like Sydney or Melbourne isn’t going to be easy. This leads me to the dream home myth that’s holding people back… 

The dream home myth 

Just as you don’t step out of university and into a high-paying executive job, it’s unlikely you’ll be able to step from your rental home into your ideal dream home.  

And if you hold on to the idea that your first home should be your dream home, you might delay your ability to buy a home by months, years… or even indefinitely.  

Here’s the truth: for many first home buyers, your first home won’t be anywhere near your dream home. And that’s okay. In fact, that’s really normal.  

You may not be able to buy in your ideal area, with your ideal number of bedrooms and with the kitchen you’ve been building in your mind for the past decade. 

But you will be able to take your first step on the property ladder – and that is going to lead you towards your ultimate goal. 

Getting realistic about your next step 

We’re getting a lot of enquiries from first home buyers at the moment and their wish list is not easy to achieve. They want to live…

Often, these homes have a price point of $1.5 -2m (or even higher), which means these first homebuyers are toiling year after year to save a deposit. It’s disheartening and heartbreaking, and it’s understandable why so many people feel that buying a home is never going to happen for them.  

But, there is an alternative.  

If you can adjust your thinking and get realistic about what’s possible, you could find yourself owning a home sooner than later. 

It’s about adjusting expectations: to get your first house, you start small, in an area that you can afford. It might mean you buy a house in a different suburb for $750,000, then wait until that grows in value and leverage into something closer to the city. 

You don’t have to live in it – you might decide to rentvest instead, where you continue renting in your desired suburb, but buy a home where you can afford it. Want to learn more about rentvesting and how it could help you get onto the property ladder? Read our article ‘The risks and rewards of rentvesting.’

After 2 or 3 years, you buy a townhouse, a little closer to town. Before long, you work your way up to a freestanding house in your ideal suburb. 

The sooner you get started in the property market, the sooner you can get on the path towards owning your dream home, on the beach, with a brand new kitchen and a pool. And it all starts with letting go of the myth that your first step on the property ladder needs to be your dream home. 

If you’d like to find out more about getting started in the property market, get in touch with Zippy Financial today. Buying your first home is an exciting time but it can also be stressful. It is not uncommon to feel a little overwhelmed by the whole process, but with us on your side we can make buying your home much, much easier.  

Phone: 1300 855 022              Email: clientservices@zippyfinancial.com.au


Zippy Financial is an award-winning mortgage brokerage specialising in home loans, property investment, commercial lending, and vehicle & asset finance. Whether you are looking to buy your first home, refinance or build your property investment portfolio, the team at Zippy Financial can help find and secure the right loan for you and your business. 

About the author:  

Louisa Sanghera is an award-winning mortgage broker and Director at Zippy Financial. Louisa founded Zippy Financial with the goal of helping clients grow their wealth through smart property and business financing. Louisa utilises her expert financial knowledge, vision for exceptional customer service and passion for property to help her clients achieve their lifestyle and financial goals. Louisa is an experienced speaker, financial commentator, mortgage broker industry representative and small business advocate.  

Connect with Louisa on Linkedin

Louisa Sanghera is a Credit Representative (437236) of Mortgage Specialists Pty Ltd (Australian Credit Licence No. 387025). 

Disclaimer: This article contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information. This article is not to be used in place of professional advice, whether business, health or financial. 

Most people have heard of rentvesting: it’s where you rent where you want to live, but buy a property where you can afford.

It means you can keep renting in the area where you have built your life, but to get your foot on the property ladder, you buy a property in a different suburb, city or even state.

You might be renting in an area where the rent is manageable, but the cost of buying is well out of your reach. This is the kind of scenario that rentvesting is perfect for.

Is rentvesting really the answer to affordability issues?

Here’s the reality: as property prices continue to climb upwards, many potential homebuyers have found themselves priced out of parts of major cities such as Sydney and Melbourne.

Property prices across the country are booming right now, so if you can’t afford to buy now in the area you’d prefer, it’s likely to be even less affordable a year or two from now.

That’s why many people are now exploring alternatives, to be able to get a foot in the door of the property market!

Is reinvesting a perfect solution? Not always. There are some downsides, which I’ll get to in a moment. But first, let’s discuss some of the benefits of rentvesting.

How does rentvesting actually work?

The best way to explain it is through a hypothetical example.

A young couple in their early 30s began rentvesting. They want to keep living in a capital city for their careers, but buying a home in their local area was well out of their price range – and they couldn’t see a time when it would become possible.

Instead of buying in Sydney, they chose to rent a place in their ideal suburb, while saving up for a property located in the Gold Coast – an area they chose for its relative affordability, rental demand and growth potential.

They bought an investment property for $400,000. A few years later, they used the growth in that investment to purchase a second investment property for $500,000. Five years later, they refinanced both investment property loans, and withdrew enough money to use as a deposit on a small home in Sydney.

Thanks to rentvesting, they were able to eventually buy their own home in Sydney, and they also now own three property assets. Now 40, they have plenty of options ahead of them:

This is a far better outcome than simply continuing to rent and saving for a property deposit for years and years…

That said, rentvesting does come with a few risks and downsides you need to be aware of:

There’s pros and cons to weigh up on both decisions, but the bottom line is: if you dream of owning a property, now is the time to look at all the options and make a plan to move you forward. If you’d like to find out your borrowing power and chat about your options, contact us today for an obligation-free chat on 1300 855 022.

Comparison Rate calculated on a secured loan amount of $150,000 for a term of 25 years. WARNING: This Comparison Rate is true only for the example given and may not include all fees and charges. Different terms, fees and other loan amounts might result in a different Comparison Rate. Fees and Charges Apply. Terms and Conditions are available on request.