Will homes ever be ‘affordable’ again?

Sue Tierney

In 2021, the average house price is now an eye-watering 12.4 times the average wage. 


That’s not an issue if you’ve paid down your mortgage – and even better if you own a rental or two. But what about young Kiwis who are at the start of their working lives?


Many of them are resigned to never getting on the property ladder. With home ownership rates declining since the 1990s, the proportion of New Zealanders owning their own homes is now around 64%. (There’s a comprehensive report here if you want to dig into the details.)


It seems the great Kiwi property dream is defunct for growing numbers of people. And looking at the numbers of Millennials dabbling with cryptocurrencies and investing via platforms such as Sharesies, you might conclude that first-home buyers are an endangered species.


But we’re not so sure.


How to get onto the property ladder.


We deal with families and young buyers every day, so we’ve got a pretty good idea of how to get them into their first home. 


It starts with getting pre-approval for a mortgage, because you don’t want to start putting in offers until you know how much you can spend. Here’s what we advise:


  1. Meet with us well before you look at any houses. It’s about forward planning, which means understanding your current financial position from the bank’s point of view. You may need to bed-in some changes to improve your chances of getting pre-approved for a loan. 
  2. Eliminate debts. Ruthlessly tackle those HPs and credit facilities until you have no more monthly debt repayments going out.
  3. Minimise your use of credit cards. Or get rid of them altogether.
  4. Start building a deposit, by making steady contributions month after month. Banks like to see evidence you’re a disciplined saver.


There are more tips and tricks, which we can share when we work with you. But with an honest appraisal of your spending, and the right habits in place, we’re confident you can get yourself into a position to buy a home.


Sure, it may not be your dream home in your dream suburb. But don’t forget, there’s a reason it’s called your first home.


And we’ll help you get into it.


The real estate market is not on hold. If you’re looking to purchase and need a mortgage, we’re here for you.

We're here to help you with home loans, personal finance & insurance.

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Wealth creation is not what you own. It’s what you control.

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