26 May 2016 Saving for your first home deposit Saving enough for your first home deposit can appear an insurmountable hurdle when you start from scratch. But every year thousands of Australians get onto the property ladder for the first time. There's no doubting that buying a home is the biggest financial commitment most will ever make, so it’s important at the outset to establish, and then monitor, your household budget. In the countdown to building a deposit - be it 10% or perhaps as much as 20% - for the typical first home buyer loan of $300,000, creating a budget is important, but it’s important to make sure it's realistic and manageable. Once you are in the savings mindset and working towards the deposit there are a few simple tips that may help you reach your goal, be it sooner or later. By all means imagine how long you might take, but simply start by budgeting, perhaps in accordance with the length of your pay period. This way you will be able to adjust the budget fairly quickly as it inevitably indicates how you will either underestimate or over overestimate expenses as the months or years pass. List your income and all expenses, including food, car and entertainment on a budgeting calculator. Everyone will have their own ways to save, but maybe cut back on the gym, pay television and the overseas travel plans and, start taking your lunch to work. Genuine banked savings is something that lenders will certainly want to see when applying for a home loan. Yes, things like tax refunds or an inheritance will assist, but the money should come from your regular salary deposits into a savings account. Make sure you research all the upfront and ongoing costs involved in buying a property, such as stamp duty, conveyancing and legal fees, strata fees if purchasing an apartment, and council rates. Go to a lender once your deposit strategy is underway, so that your desire for home ownership can be transformed from dream to reality with a little guidance from professionals who know the route. And of course, always keep an eye on the property market, and then research seriously once you have saved around 5% of the purchase price and have an idea of what and where you want to buy. Homebuyers usually take another year or so to build up the remaining 5% deposit plus extras, so they are ready to buy wisely depending on the market conditions. Good luck! Speak to Lisa Frazer at RAMS Lake Haven about your home loan needs.