As an Auckland mortgage broker we often hear people saying that it is impossible to get onto the property ladder in Auckland (and it is definitely hard) but there are some areas close to Auckland that must be worth considering.
For Auckland first home buyers maybe a small settlement like Meremere is worth a look…
Have You Looked At Meremere?
Meremere is a small settlement approximately almost exactly halfway between Hamilton and central Auckland (62km north of Hamilton: 63km south of Auckland).
Nearly 500 people live there (468 – Census March 2013) and there is a primary school in Meremere (years 1 to 6).
Meremere is well-connected for travelling to either north to Auckland or south to Hamilton and places in between. If you worked in Manukau then it is about 30-minutes to drive which is no different to the time it takes for many people to get to work.
Most importantly the houses at Meremere are not too expensive – yet.
On Trade Me today (11th June 2017) there were five houses listed for sale in Meremere and they range in price from $320,000 to $399,000 which is a lot more affordable than areas like Pokeno which is just 10-minutes up the road, but where it is hard to find a house for under $700,000.
And they promote Pokeno as an area for Auckland first home buyers.
Cheaper Than Renting
If you can buy a house in Meremere or elsewhere for $320,000, and have a 20% deposit then the mortgage repayments could be as low as $300 per week which is cheaper than renting in many areas.
The calculation here is based on;
A 20% deposit ($64,000) – most banks want a 20% deposit and this can include your KiwiSaver and the HomeStart Grant if you are eligible. If you do not have a 20% deposit then you might be able to purchase your first home with a 10% deposit using a Welcome Home Loan, a non bank lender or possibly a bank. As mortgage brokers we can advise you of the options available to you.
The current special interest rate offered by ANZ of 4.49% – of course the interest rates vary so we will need to check this at the appropriate time. You can check interest rates here but speak to a mortgage broker as they can often negotiate lower home loan rates.
A 30-year mortgage term – this is the standard mortgage term. Of course everyone wants to pay their home loan off more quickly and as mortgage advisers we can show you how to structure and manage your home loan to achieve that.
Key Advantages Of Owning Your Own Home
We agree that it is not easy to buy your first home.
Even 25-years ago it was hard, and I wrote an article on my personal experience which was interesting in hindsight.
This was my first home, and if you click the image you can read my story.
There are some key advantages of owning your own home, even if it means buying something not quite as nice to start with. Here are my three key advantages;
- You can stop paying rent to someone else – of course instead you are paying a mortgage, but the advantage is you will eventually pay the mortgage off and then the cost of home ownership is minimal. On the other hand we are seeing rents increasing so over time your rent will become more expensive.
- You have stability – so often we see people forced to shift as the landlord decides to sell the house that you are living in. Unfortunately in New Zealand many landlords have a short-term view and as things for them change it can mean you are forced to shift. Stability is important when you have a family with kids at school.
- You can make changes – when I purchased my first home I made a few changes as the budget allowed. I did quite a bit of planting and created gardens, I built a large deck and created a bbq area plus I replaced the over and installed a dishwasher. These were not major changes but they suited the way I lived at the time and were not expensive, yet added value to the property.
These are just a few advantages of owning your own home.
Do Something …
It is worth having a look at what is possible, and also having a look at places like Meremere as a place that might present the opportunity to get onto the property ladder.
Meremere may be a good place for Auckland first home buyers to look – especially those working in South Auckland.