Tuesday 02 May 2023
Buying property can seem an unachievable goal for many. Often a large amount of capital is required to get going & unless you’ve had an inheritance pay out or generous individuals lending you the money, how would you ever have that much money?
Ultimately, it’s down to you to get creative with making money, budgeting & knowing the tools you can use.
This post should provide you with ideas & resources to do all of the above.
Firstly, take a look at last weeks blog to see the breakdown of costs to buying your first investment property before reading any further, so you’re fully informed on how much money you’re going to need…
Budgeting is the ‘simplest’ way to save more money, here’s some ideas…
Set a realistic savings goal: Determine how much money you need to save then divide this amount by the number of months you plan to save, and that will give you a monthly savings goal. Be realistic about what you can save each month and adjust your goal accordingly.
Create a budget: Track your expenses for a few months to get an idea of your spending habits. Identify areas where you can cut back, such as eating out or subscription services you don't use. Create a budget that allows you to save a set amount each month.
Automate your savings: Set up automatic transfers from your bank account to a high interest savings account each month. This way, you won't have to think about it, and you'll be less tempted to spend the money.
Reduce debt: If you have high-interest debt, such as credit card debt, focus on paying it off first. This will not only save you money in interest charges but also improve your credit score, making it easier to qualify for a mortgage.
Save on rent: Consider moving to a less expensive apartment or renting a room from someone to reduce your rent expense. This will free up more money to put toward your savings goal.
Cut back on unnecessary expenses: Review your expenses to see where you can cut back. For example, do you really need that gym membership or cable TV subscription? Eliminating unnecessary expenses can help you save more money each month.
You can only save as much as you’re earning, so the next thing is to make more money…
Additional Income: Consider having a side hustle such as buying items below their market value & reselling them at a higher price or learn a new skill & offer your services on a freelance basis.
Increase your current income: Have you been in your job for a while but haven’t had a pay rise? Get a case together proving to your manager why you deserve one. If they don’t see your value don’t be scared to look for working elsewhere where they do.
Finally, leveraging what you already have…
- Leveraging: If you do already own property, the home you live in, there could be equity to release which you could leverage to buy more property. This could be from your property increasing in value or from you having paid off a large part of your property over time.
Would you consider any of the above to buy your first investment property?
The budgeting advice is simple, but saving for a property takes time and discipline. A side hustle could be hard, but worth it. Perhaps the easiest way, & a method not many think of, is leveraging.
What is true is that with dedication and commitment, you can achieve your goal of buying your first property.