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  • How soon could I buy a house by sharing?

    How soon could I buy a house by sharing?

    If you’re saving for a home, it’s a no-brainer to move into a share house, as it means you can split expenses and pump the savings directly into a deposit. But how much closer to a home does cohabitation get you, really?

    Scott Cheetham, a RAMS Home Loan Specialist from Mona Vale in Sydney, explains how much sooner you might be able to buy a house by sharing.

    Scott compares living in a one-bedroom apartment in the Northern Beaches of Sydney to sharing a two-bedroom place in the same area.

    “The one-bed apartment would cost, say $550 per week, and a comparable two-bed would be around $770, so that’s a saving on rent of $165 per week,” he says.

    “Add in average water costs, at $170 per quarter and that’s a saving of $340 per annum, then electricity at $400 per quarter, saving $800 per annum. Add gas at $200 per quarter, and you could save $400 per annum. So the total saving could be in excess of  $10,000 a year,” Scott explains. That’s a nice start on a deposit!

    Sharing a three-bedroom place has even bigger financial benefits.

    How soon can I buy a house by sharing - flatmates with wine  

    Scarlett and her partner are saving for a home by sharing with another couple in a two-bedroom house.

    “An entry-level three-bed house in the same location would be say $850 per week, so you save $260 per week straight away. If you assume similar costs to before, the total saving could be about $15,000,” he says.

    “That $15,000 per annum could bring forward saving for a deposit by a number of years,” Scott adds.

    The cost of your current living situation is one of the first things to analyse when getting serious about saving a deposit, he says.

    Start with a budget and work on the big ticket items first, like rent. Consider if you can share or live in a lower level of accommodation for a period of time to help saving for a deposit.

    “Then, look at discretionary expenses, like take-away food,” Scott says.

    How soon can I buy a house by sharing a house - front of house  

    Start your saving plan with the big expenses like rent, then budget out from there. Picture:

    Rent isn’t the only saving to be made by sharing, he adds. Things as simple as cooking meals at home and taking lunch to work can make a big difference.

    Taking lunch to work instead of popping into a café, even just three times a week, can save $30 a week, which adds up to more than $1,500 a year.

    Scarlett Templeman, a 24-year-old PR professional who has shared a two-bedroom house with her partner, Lloyd Crawford, and another couple in Scarlett, for four years, has seen first-hand the savings that are possible.

    “This particular house, (it) was definitely moving in to minimise our rent. That has come down significantly, probably by nearly a third,” she says. “It’s just a matter of thinking about where we’re putting our money.”

    The four housemates share all of the main expenses and even grocery shop together, via a joint account they all contribute to.

    “I definitely wasn’t a ‘come home from work and cook’ kind of person, but now I am,” Scarlett says.

    And Scarlett can see the difference when she looks at their bank balance and the potential to buy a house one day. “The dream is to be able to come home and be like ‘we own this’. It’s feeling less like an unachievable dream,” she says.


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    About the author

    • Raymond

      Raymond A Ram is the RAMbassador for RAMS Financial Group. Raymond works with the RAMS team to bring simple, helpful and expert information on home loans and savings accounts to life with his down to earth and cheeky personality. He enjoys seeing everyday Australians turn their dreams of saving for a goal or getting into a home a reality. 

      Growing up in Goulburn, NSW, Raymond was brought up with good old-fashioned Aussie values of hard work and a fair go. It soon became apparent that Raymond wasn't content for the conventional path of grazing, producing the very best wool, and finding a nice sheep to settle down with. So it wasn't long before his passion for performing and his talent as a likeable larrikin shone through - landing him a few roles such as 'RAMlet'. He was even tipped to play RAM-bo at one point but chose to become star of the small screen instead as RAMbassador for RAMS. He now finds this role so much more rewarding.

      Contact your local RAMS Home Loan Centre about your home loan options.

      Raymond A Ram

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  • Disclaimer:

    The information here is of a general nature only and is not intended to constitute financial or tax advice. You should consult your professional adviser, accountant or taxation expert for advice specific to your personal circumstances.

    The views and opinions expressed in this article are those of the author alone and do not necessarily represent the views or opinions of RAMS Financial Group Pty Ltd ABN 30 105 207 538 (RAMS),  Westpac Banking Corporation ABN 33 007 457 141 (Westpac) or their related bodies corporate. This article is strictly for information purposes only and neither RAMS, Westpac nor any of their related bodies corporate make any representation as to the accuracy or completeness of the information in this article or endorse the views expressed in it.