Money

“I’m In My 20s, I Don’t Have Any Savings, Will I Ever Be Able To Buy A House?”

If we’re lucky, our youth is a carefree time with limited responsibilities. Sure, we’ve got to go to work, but kids and property and mortgages and all of that serious stuff can wait.

Then as we get older we wake up a little bit. We start taking on grown up habits like “reading the news”. And then we get hit with the headlines – you know the ones, about housing affordability and millennials – that cringe-worthy term they’ve decided to use for our generation.

Then there are the stories about people who have a portfolio of investment properties before they hit 25. The people who’ve been saving since they were working the supermarket checkout; not to mention the helping hand they had from mum and dad.

Meanwhile you’ve been enjoying brunches. Or maybe you’ve been studying on a Centrelink income. Either way, you don’t really have any savings to speak of; let alone a house-deposit sized chunk of cash. You are fuh-reaking out.

Is it too late? Should you give up and invest in avocados instead?

Let’s settle this once and for all.

Start where you are

Get working on that deposit

If you want to buy a house, but you don’t have any savings, then it’s time to get started. “But how?!” I hear you cry. With a budget! And try out some handy savings tips.

You might feel like you’re behind, but that’s no reason not to get started. Having a goal makes saving money so much easier, because you know what you’re working towards.

If you’d like to make the savings process fool proof, then putting your money into different buckets ­can make it all so much easier. Westpac Life is a tool that helps you segment your savings towards different goals without the hassle of multiple accounts. You can work towards the long term goal of saving for a deposit, while also putting aside money for that trip to Bali next year.

Most people find getting the money together for a deposit to be the trickiest part: once that’s done, you can chip away at a mortgage with regular payments, much like paying your rent. If you’re looking for a bit of inspiration, read how this 20-something saved for a house deposit in Sydney.

buying property house no money no savings

Look at the bigger picture

Sure, house prices in some of Australia’s biggest cities – Sydney and Melbourne, we’re looking at you – are a bit hard to swallow right now.

But that’s not the whole picture. What about Adelaide, Brisbane or Perth? Or if country living is more your style, there are tons of options all around Australia where you can get a dose of fresh air and a shorter commute to work.

Don’t want to move? Then rentvesting is the way to go. “What’s that?” I hear you say. Well, it’s where you buy a property where you can afford one. You treat it as an investment and rent it out, while living in a rental where you’d prefer to live.

It’s a genius way to get a foothold in the market and chip away at the big costs. You get into property ownership way sooner, build wealth and work towards owning your dream home.

Westpac research has found that while only 8% of current homeowners are rentvesting, this approach is becoming increasingly popular. 2 in 5 (41%) of those surveyed believe that it’s better to buy an investment property in an area where they can afford and rent a house in an area you really want to live in.

Lauren Fine, Head of Westpac Home Ownership at Westpac says young people are leading the rentvesting charge, with 61% percent of rentvesters being Gen Y.

“The research shows that many young Australians are looking at savvy ways to get into the property market, showing that there’s still clear aspiration for home ownership whilst maintaining their lifestyle.”

Do some research

Take a look at some regional hotspots and see what the house prices are like. If you’ve been looking in inner Sydney, you’ll notice how the prices in regional areas only have one comma, not two. This is not a mistake.

Now figure out how much you’d need to save for a 10-20% deposit. Don’t be daunted by that number: it might take a little while, but with dedication, you can get there.

It’s not too late

Everybody has to start somewhere. Having a bit of a financial freak out can be the kick-start you need to get serious about this whole “home ownership” business.

Remember, comparing yourself and your financial circumstances to other people isn’t going to help. As they say, comparison is the thief of joy. Run your own race.

Getting beyond the alarmist headlines and applying some creative thinking can really change your perspective. Maybe you aren’t going to be buying a four bedroom house in central Sydney tomorrow, but with a bit of dedication you can start climbing the property ladder and work towards owning your dream home.

Rentvesting can help you own a home within your budget. Westpac offers property and suburb insights to help you find an investment property that suits you, and provides loans for rentvestors so you can start building your wealth.

Still confused about this home buying thing? Head into a Westpac branch and chat to a home loan expert. Trust us, there’s no such thing as a stupid question.