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The Affordability Questions You Need to Consider

March 2019

Beginning your new home journey can be a daunting experience, especially for those that are new to the game. However, with careful planning and sound advice, you could be on your way to building your dream home in no time. Read over our list of helpful questions that you may need to consider, regarding your ability to buy.

Do you need to check your spending? (or keep it in check?)
As hard as it may be to restrain, unnecessary spending can be a major thorn in the side of your
saving capability. With the vast majority of transactional spending happening electronically these
days, it is important to take a look over your bank statement and track your spending habits. Can you
forgo the daily coffee run or regular cheese platter? It may sound small and insignificant, but it is
these habits that could be stopping you from saving for a house deposit.

Do you need to settle any outstanding debts?
Your financial situation will be assessed by your chosen lending institution and as with any big money
loan, a discrepancy or outstanding debt may be viewed as unreliable. Settling outstanding payments
and showing a clean record of steady repayments will hold you in good stead for the loan approval
process. Speaking with your bank or a mortgage broker would be beneficial in helping you find the
most appealing home loan for your situation.

Do you have a realistic and attainable budget in mind?
Once you have taken care of your personal funds, you can start looking into exactly where and what
you want to build. Once you begin, you will find how easy it is to get carried away with larger
allotments and unnecessarily large homes, which could throw your budget out the window. What do
the repayments look like on the entire borrowed amount? It is important to work out an attainable
budget that will allow your block, home build, landscaping, optional extras and any build-related fees
to be covered comfortably.

Do you have a ‘safety net’ in place?
Quite often, the most meticulously-laid intentions don’t quite go to plan. Work drying up, dental bills,
vet bills – you name it. While it isn’t good to dwell on the what-ifs, it is important to make assurances
for them. Placing any savings you do have in a high-interest account is doubly effective, by allowing
you to earn interest, whilst also removing the temptation to spend it. Any setbacks in the process of
saving shouldn’t deter you from hitting the saving goals you have established.

Do you have someone to help keep you on track?
Every now and then along your saving journey, it is okay to treat yourself, you’re only human. While it
is okay to make the odd purchase, it is helpful to be able to talk with someone about your saving goal
and they may help keep you on track with a reminder about what the endgame is – your brand new
home.