Couples have a leg up on others
Sorry singles! Data collected from CoreLogic found that couples are more than twice as likely (64 per cent) to own property compared to single people (33 per cent). The Australian property market is notorious for being incredibly expensive and hard to get into. In fact, the data also found that 62 percent of Australians – these are first home buyers and upgraders alike – believe housing affordability has gotten worse over the last year. And they aren’t wrong, capital properties have risen 10.9 per cent, which affects everything from stamp duty to deposit amounts.
The double income, therefore, is a massive help in getting into the property market. It also makes it easier to get a loan – 43 per cent of singles told CoreLogic that the process was a stressful one where as couples were much less phased at 34 per cent. Of course, singles can opt to go in on a piece of property with a friend or family member if they are struggling to do it on their own. If you are so eager to get in on the property market, your partner technically doesn’t need to be romantic!
Just because it’s easier to get a house with your significant other, doesn’t mean you’re really ready, financially or emotionally, to roll out the welcome mat. Next, we discuss how you can tell if you should make such a massive financial commitment together, or not!
Are you ready to buy a home with your partner?
Making a purchase as big as a house means you and your partner need to be in a solid place. Obviously, if you’re married or in a serious long term relationship, that’s a good sign you are ready to buy a property together, but if you’re still not ready for that kind of emotional commitment, ask yourself if you’re ready for a big financial one. You can tell if you’re both really considering each other in your future if you talk about future plans saying ‘when’ instead of ‘if’.
Job stability is of course one of the biggest indicators of readiness. You’re both going to need to pay off your home loan, so it will be important to have two incomes supporting this. Do you both love your jobs and feel secure? Once you’ve settled down into stable careers you are in a good place to ensure you will have financial security to buy a house.
Tips on buying a home with your partner
If you are, in fact, ready to buy a home with your partner, then we have some advice on how you can do just that.
1. Save, save, save
Yes, it might be 64 per cent easier for you to buy a house, but it’s still going to be expensive! The golden rule of buying your first home says that you should save up for a deposit of 20 per cent of the purchase price. This, plus a little extra for unforeseen costs, will put you in a good place to move in. If you need help calculating how much and for how long you need to save, try playing around with our savings calculator.
2. Think small
You probably aren’t going to get your dream home on your first go, so it makes good financial sense to purchase a home that is a bit smaller so you can save up for the bigger home. This will also help you pay off your loan a bit easier which will make you look more appealing to future lenders (assuming you’re diligent with making your payments, of course). Your credit score will be evaluated when you are applying for a home loan, so you and your partner will want to ensure you have your report in order.
3. Get pre-approved
Getting pre-approved will help you determine the cost of repayments as well as how much you can afford. Once you’ve decided you’re ready to buy a house, be sure to do this step early on in the process so you have a clear idea of what the financial commitment looks like.
So what do you think – is it worth partnering up to get into your dream home? Don’t worry! If you’re perfectly happy living the single life, Police Bank will take a look at your financial status and help you get a home loan that will get you into the property market anyway!