It’s become notoriously difficult for younger generations to take their first step onto the property ladder in recent decades. A combination of lower wages, student debt and high property prices mean that many 20- and 30-somethings will have to start thinking outside of the box if they want to own their own home one day.
The good news is that there are other options, many of which come with their own unique set of benefits too, if you’re brave enough to take the plunge! Let’s take a look.
Buy the place you’re renting now
If you’ve been renting the same apartment for several years, you’ve likely got a good relationship with your current landlord. They know you always make the rent each month, so selling privately to you is a way for them to avoid estate agent’s fees with less risk to them than selling to a stranger. As an added bonus, you already know the area, and you won’t have to incur all those moving costs!
Although it’s not for everyone, if you love the place you’re in now, it’s definitely an avenue worth pursuing. You’re likely to get a discounted rate too, which could make the difference between being able to buy now or having to keep saving up for a deposit.
Build your own
It’s a pretty daunting prospect, but there are loads of advantages to buying land rather than an existing house and building your very own home. You get to design your home to fit around your lifestyle, requirements, tastes and quirks. If money is particularly tight, building just the very basics you need to live on site and adding additional features whenever you have extra cash on hand is a possibility.
If you want to use sustainable materials and incorporate your own renewable energy sources, you can. Depending on where you live, there are even companies who create affordable prefabricated modular housing units just for this purpose – meaning you can add on rooms as your family grows.
You get to be involved in every step of the process and work alongside your contractors, be they, local artisans, Forklift Guys to help with the heavy lifting, or local landscapers to help you create your dream garden. One thing you must have very clear in your mind, however, is that building your own home can be a long and gruelling process, and invariably ends up costing you more than you expect. The rewards, of course, are immense – and for many cash-strapped young adults, it’s the only way they can realistically enter the property market.
Another option is to buy a real fixer-upper cheaply and spend your money on improving and upgrading it for a few years before selling and moving onto a new home. If you find you have a knack for it, this can be a great way to keep moving up the property ladder until you find your forever home!
Whether it’s with a partner or a longtime friend, you don’t necessarily have to go it all on your own. If your parents aren’t able to assist you, then joining forces with another party or parties that you trust and know well can be an option. It can be a little tricky to find the right bank, but if you and some of your childhood friends find yourself in the same boat, it’s definitely worth investigating a split mortgage.
No matter what your plan is, get into the habit of saving
Whether you plan on going it alone, building your own or teaming up with friends or your partner, it’s impossible to get started without first getting into good financial habits. Getting out of debt and getting into the habit of saving every single month is the best possible place to start, whether your end goal is a small flat or a sprawling mansion! The more capital you manage to save up, the faster you’ll be able to realize your dream.
This starts with living below your means, and automating saving so you don’t have to rely on your own willpower. Tax-free investments that you can contribute to each month via a debit or stop order are one of the easiest and most affordable ways to do so, and you’ll be surprised how quickly you learn to live without that little bit of extra money each month. If you do come into some extra cash, squirrel most of it away immediately so there’s less chance of giving in to the temptation of spending it. Getting onto the property ladder isn’t always easy, but the short-term sacrifice is definitely worth it!