Buying a new home doesn’t mean the house has to be fresh off the block new. Sometimes, the potential, opportunity and savings are buried in older homes that need a bit of extra TLC. So, with house prices on the up and a baby on the way, savvy couple Bec and Gil decided to buy into the challenge and charm of a reno – and now they have some top tips for like-minded fixer-upperers.
1. Plan it.
When Gil says, ‘Yoga is stretching that costs more,’ you know he’s mindful of his money. Good thing too, because when he started dating Bec, they were aligned on their goals of buying a home and planning a family. Of course, they had to raise a house deposit before raising kids, and they even took future bub into the planning stage.
‘I love Excel,’ says Bec. ‘Spreadsheets, budgets, looking at future scenarios … If we had a child, what would our budget look like? Things are also going to pop up, like unforeseen costs, but if you factor that in, it's not as scary when it happens.’
‘We did a lot of planning and set our maximum based on a worst-case scenario,’ Gil confirms. But in the meantime, Melbourne house prices were on the rise.
‘We loved being in a city, but knew we needed something bigger if this was going to be our forever home where we could raise a family,’ explains Bec. ‘I really wanted to find something that had opportunity in terms of making it our own.’ And so they found a disused ‘knock down’ within their budget, and fell in love with its potential.
2. Be realistic about it.
‘Don't judge books by their covers,’ says Gil when it comes to fixer-uppers. Sure, they had to see past the fly infestation, a squatting possum and the outhouse (which they cleaned up and kept). But they also got a sound structure (that saved them on reno costs), a great layout, high ceilings and plenty of character.
The key was being realistic with what they could afford. ‘For us, location was more important than the house,’ says Gil. ‘So, we went all in on location instead of a finished home to walk into.’ Adds Bec, ‘I just didn't look over a price point. I also factored in what we were looking at was probably going to go for say, 20 per cent more.’
Now with work on the reno underway, they’re not scrimping on living. All that planning has them feeling secure in their home purchase, and on buying things that bring short-term satisfaction. ‘If it's in the budget, do it. Don't feel guilty about it because you've gone to the trouble of prioritising and budgeting,’ says Gil.
3. Talk about it.
In a final tip that borders on (ME thinks) valuable relationship advice, Gil suggests, ‘If you're buying as a couple, really talk it through first. For us, it was everything from the financial commitment to the emotional commitment of buying a house together. Make sure you're ready on both those aspects.’
Luckily, they agreed on the big things. And today, with the flies and possums making way for the home’s rightful new residents, Gil reflects on their purchase.
‘I'd rented for a long time and (now) if the hot water system breaks, you've got to fix it. But there is some gooey little feeling about it being yours.’
With a baby now on the way, it’s a good thing they like that feeling.
Get more property buying tips, whatever rung of the ladder you’re on, with House Mate. From ME, the Aussie bank Making Money Good.
This article is prepared based on general information. It does not take into account individual financial objectives or needs and is not financial product advice.