[paddyboo]

roughly, a loan of $300,000 would have repayments of about $500/week....

[Lightning_bug]

In all honesty, it's less about how much you earn and more about borrowing within your means.

A bank will offer you the most you can borrow. If you need the maximum, then you're not earning enough.

We made a rule of taking $100k less then the bank offered. They tried to talk us into more but we wanted a life as well as a home. Thank heaves we did! When I quit my job or went on maternity leave or the interest rates jumped - we still had a healthy buffer zone. When these things weren't happening, we still were able to save.

[Lainskii]

As others have posted, pay your loan off first. There is no point saving if you have a loan as it doesn't make financial sense. Have you drawn up a budget? If not then it is always a good idea and then keep a spending spread sheet to see where the money is going and to see how your budget is going. Every dollar off your loan counts and the same goes for when you've paid it off and can start saving. Good luck OP.

[meggs1]

Agree with PPs advice to concentrate on paying off your debt and getting settled into better jobs. You've been through so much it's no wonder you haven't been able to save.

Then I think you need to think about why you want a house.

If its because it's a good tax effective investment then maybe look at getting some advice about other good investments that dont require so much initial outlay. As long as you are saving somewhere it doesn't have to be in your own home. The reason a mortgage works so well is that you have to pay it, but if you are disciplined you can make weekly savings into something else which will be just as good.

Depending on income level it might be worth salary sacrificing into super so as to take advantage of the Super Co-contribution Scheme.

If its to get into the market before things go up more, maybe look at buying something cheaper with growth potential that you can rent out. Say a low maintenance unit close to transport. Later on when you have some equity in that, more borrowing power, and the kids are older you will be in a better position to buy your own home.

If its to have residential security, then focus on finding a rental which is likely to be long term, and keep up to date with having a lease, rather than allowing it to go month to month.

Best of luck

[Guest_Retro_Mumma_*]

Here is what you do, dont buy a residential property as your first house.

Buy a low cost investment that you can afford.

The repayments on a $300,000 loan are $450 a week. Then you have got to take into account interest that gets added on each month which you cant claim back if the loan is for a residential property.

If you buy an investment property and the loan amount is $150,000 (inc stamp duty etc) the repayments are $240 per week and you can claim the interest that gets added on your loan as a tax deduction amongst many other things.

Plus you could rent the place out and get around $120 per week (i dont know what rental returns are like in your area). Which again is negative gearing which is another tax deduction.

Then once you are positive gearing or you have a heap of equity in your loan you can buy a residential property and you then you will have an investment thats making you money that one day may pay off both loans and a house to live in.

You just need to get your foot in the door and go from there. Just as long as you start out small and buy within your means you should be right.

Good luck.

[laridae]

Here is what you do, dont buy a residential property as your first house.

You do if you want the FHOG & stamp duty exceptions (if there are any in your state).

You can't get FHOG for investment properties.

[Mummy Duck]

Here is what you do, dont buy a residential property as your first house.

Buy a low cost investment that you can afford.

The repayments on a $300,000 loan are $450 a week. Then you have got to take into account interest that gets added on each month which you cant claim back if the loan is for a residential property.

If you buy an investment property and the loan amount is $150,000 (inc stamp duty etc) the repayments are $240 per week and you can claim the interest that gets added on your loan as a tax deduction amongst many other things.

Plus you could rent the place out and get around $120 per week (i dont know what rental returns are like in your area). Which again is negative gearing which is another tax deduction.

Then once you are positive gearing or you have a heap of equity in your loan you can buy a residential property and you then you will have an investment thats making you money that one day may pay off both loans and a house to live in.

You just need to get your foot in the door and go from there. Just as long as you start out small and buy within your means you should be right.

Good luck.

This is exactly what we are going to do. Yes we will miss out on the FOHG but its less of a risk having a smaller mortgage. Our thoughts are to continue renting a family home and purchase our retirement home soon. So in 20 years or so when the kids have left we will have our retirement home paid for. It means we wont have to pay double our current rent in a mortgage which frankly we just cant afford. At the end of the day its about us having security in retirement not about owning a home now.

Looking at our incomes and house prices its just not achievable for us to buy a home and have the lifestyle we want.

This post has been edited by Mummy Duck: 26/04/2012, 01:44 PM

[Apageintime]

I do sometimes ask myself why it's so important to buy a home anyway....to be honest, I'm not sure it's something you *have* to do - it's sort of a 'given' in our culture, but I'm not sure it has to be - especially if it means living a very stressful life without any spare money to 'live'. Something to think about anyway

This. Buying a house isn't a MUST, although everyone in Australia thinks that you should. Don't worry about the money you're paying in rent either - you could have 'wasted' that much in interest/ rates/ water payments if you had purchased anyway.

I would focus on paying off your loan and try very hard to get a decent savings base behind you.

FWIW - we earn over $120k and 'can't afford' a $300k home loan because we prioritse other investments.

This post has been edited by A.page: 26/04/2012, 07:02 PM

[Verurtle]

We haven't been able to buy a home in the last 10 years - we just havent been in the position to.

At one stage we were both working full time but with daycare fees and a car loan we couldnt afford to save - For me my prioprity was to pay off both cars and own them outright.

Since that time we went back between one income, no income and casual work only. Its only now that I am about to start a full time job in 2 weeks that we will be back on 2 incomes.

For us hopefully we will be able to save a lot of money, having been on centrelink payments 2 years ago to bringing home $1600 per week is a big change.

[bryce's-mummy]

I don't think I'm so worried about the money I've paid out in rent (as many PP's have said- I would have paid more than $100,000 out in interest over the last few years)- it's more about having my OWN place to do with what I like. I HATE my landlord coming to pick up money every fortnight (this is in the lease agreement and how he chooses to do it- no bank deposit etc. I can't change it). I can't do anything to the house- having to ask permission to do the tiniest of things etc. So it's been hard. I do have a budget that works- and helps us pay off the week to week stuff. But 10 years ago we talked abou buying a small unit/home for a 1st home- but on DH's (then DP's) wage- it wasn't possible. And as the years go on house prices jump and you need more and more of a deposit. So it never becomes within our reach. And now that we have had more kids and life's surprises it has been hard. Luckily for us our loan is through a friend so we pay minimal interest and it's not under our name per se. And we have no credit cards or store card debt. But I do have a $15,000 HECS (HELP) uni debt that will need to be paid off when my salary is high enough.

I was feeling a little sorry for myself the other day- mainly cos I was speaking with a friend who is a few years younger than me and has three properties. The one the live in they own outright (not cheap either) and another they half own and another they have just bought. She doesn't work- she stays home with their two kids. Her DH earns good money and they have always been well-off and never had to rent or rely on CL. I just can't believe that me, straight A (okay a few B's!) student and HD uni graduate at my age now has little to show for it. I just get down very easily- especially when it comes to money and providing good things for my kids. I know my children have a roof over their head, are well dressed, fed etc and that's all that matters (I know we are very lucky)- it's just that I know people from my very average public highschool who were outcasts and D students who now own their own businesses and stuff. All my life I have worked hard but had nothng but bad luck.

Sorry about my typos- it's late and I am a very messy typer!!

This post has been edited by bryce's-mummy: 27/04/2012, 11:32 PM