Here’s How to Afford Your First Home If You’re a Millennial

Perhaps you’ve realised it’s now the time to think about building long-term assets and preparing for the future. And lately you might be thinking that you should have your own home now (no more renting an apartment).

More than half of all the millennials share the same thoughts as you. As a responsible adult, you’re now thinking of having a permanent place to settle and perhaps start a family. It’s also good to have your money being put into something permanent or that will increase in value.

How to afford your first home

But having your own home costs a lot of money upfront (whether you’re planning to buy a prefabricated home or building a customised one). You have to think about the cost of the land, construction materials and labour. Even if you have a significant savings, affording your first home could be a huge challenge.

To overcome that challenge, it’s always good to start with your goals and wants. This isn’t just about adjusting your goals so that it can fit your budget. This is also about ensuring that you’re not just following a trend. Setting a clear goal and making a comprehensive list of what you want will also give you clear expectations and ideas about the expenses.

First-time homeowners and buyers are often surprised about what it takes to have their own house. For instance, residential land can cost up to $1,000 per square metre. Also add the building costs which could reach up to $1,500 per square metre.

So if you plan to have a 300 square metre home, the approximate total land costs would be $300,000 and the building costs would be $450,000. That’s $750,000 in total and keep in mind that this is just a rough estimate. Costs would go a lot higher depending on the location, additional features and amenities you want, labour costs and construction materials.

Anyway, let’s start with land. How to find a good location and still falls within your financial range? It’s recommended to start with new or emerging suburbs instead of an established one. Yes it’s true that established suburbs and locations are more attractive. But these are also often a lot more expensive because they’re in demand and these locations are fully developed already.

It’s also good to pay attention to the future developments in the location. Right now it might not mean much but sooner or later, homes and establishments will sprout in the area one by one. Even when the foundations of your home are being set, neighbour homes might also appear at the same time. By the time your home is finished (4 to 12 months or more), other homes might have also been done or starting.

Get accurate building quotes

Accurate planning and budgeting start with having accurate information in the first place. That’s why it’s important to have accurate data about the construction costs and the inclusions in the project.

To start, you can contact us here at Hume Building so we can discuss your requirements and provide you with an estimate. We’re committed to controlling costs while working within your vision and requirements. You can call us today at (02) 4630 8967 if you want to know about our services and inclusions (e.g. pre-construction consultations, all council approvals & inspections).