How to buy your first home in your 20s

  • First Home Buyer, 
  • New Home

If you were to listen to popular belief about young people entering the property market, you would think that it’s virtually impossible to buy your first home in Australia. However, Olivia Nicholls proves that conception wrong. At 22, Olivia is now living in her brand-new Geelong Homes home in the popular hotspot of Torquay and is absolutely loving it.

Olivia wasn’t the product of an inheritance or a hand-out from the “bank of mum and dad”. Olivia reached her goal through her own ambition and drive to achieve her dream of buying her own home.

“My parents bought a property in Bellbrae when I was about two or three years old,” Olivia says.
“They worked hard to pay that loan off. My mum instilled in me that if you want something, you earn it.”

Olivia’s story gives people of any age something to aspire to. How she reached her goal isn’t anything groundbreaking but shows where research, hard work and determination can take you.

So how did Olivia do it?

Working hard, saving early

Olivia is a great saver and budget keeper. But what makes her stand out is that she started saving young. Olivia’s first jobs included babysitting and tutoring, while at university she did part-time work at a real estate agency and with a mortgage broker — two positions that gave her valuable insight into building a home. She’s now a media adviser for a local state MP.

“I’ve worked since I was 12 years old,” Olivia says. “My mum instilled in me a strong work ethic and the idea that nothing came for free.

“I’m one of four kids, so growing up I had third-hand clothes, not second-hand clothes. But having said that I got everything I needed and was still able to do things like singing lessons or horse riding lessons.

“I was also given the ability to save.”

So while some of her friends were buying brand-new first cars, Olivia says she was weighing up all her costs. She opted to buy a cheap first car and stayed focused on saving every dollar.

“I needed to get a car but I was very conscious that what I spent on a car I wouldn’t be able to spend on my house,” she says.

“Property is an investment, a car starts depreciating from the first moment you drive it.”

By the time she was 18 she had a good amount of savings and started to actively look to buy a home.

Olivia and Collins on their new titled land

Why research pays off

Olivia says it’s important to surround yourself with people who know how the property market works and know what questions you should be asking.

First up she spoke to her family friend and mortgage broker Isaac Baker from Yellow Brick Road Geelong & Torquay.

“I said to him, I have got some savings to buy a house,” Olivia says. “But Isaac told me ‘it’s not enough, you have to get to ‘here’, but with a good budget you’ll be able to do it’.”

Through her experiences at the real estate agency and the mortgage broker she learnt of the many benefits of building a home as a first home buyer, including the $20,000 first home buyers grant and no stamp duty.

Olivia says Isaac also explained to her about how buying land works and how some estates don’t title their land for up to two years—allowing you to secure a block of land while continuing to save money while you wait.

By following this process Olivia got her foot in the door by putting a deposit down for a block of land while spending the next two years planning on how she’d finance it.

Learning about the building process

Olivia says she asked Isaac which builder he would recommend—his answer was Geelong Homes. So Olivia booked her appointment with Geelong Homes new home consultant.

“I walked out saying, ‘yep, I wanna build with them’,” she says. “But I had to do my due diligence. I ended up seeing five or six other builders and I had plenty of time to think about which one I would choose.

“What I really liked about Geelong Homes was that my new home consultant was able to give me a ballpark figure on the spot for the whole build and for little extras.

“Also with the other builders, it wasn’t a very personalised experience. With my Geelong Homes new home consultant he really understood me. Secondly, I felt like Geelong Homes wasn’t wasting my time; everything was seamless. And thirdly, they only hire local tradies and suppliers and I really wanted to support local.”

During the sales phase, Olivia worked closely with her new home consultant to find a floorplan that suited her block. She also wanted upgrades and modifications, including lots of windows, a living area that captured sun in the winter and a good-size backyard for her German Shepherd Collins.

She ended up choosing the Monterey 164 with a rear flip and the Bungalow facade.

“I ended up spending less than I borrowed,” Olivia says. “Every upgrade, I considered ‘is this upgrade going to add value to my house?’ Geelong Homes has a great upgrade pack—which was a no-brainer.

“People took a keen interest in me during the building process because I am young. So they were willing to give me advice. At my last meeting with my site manager Tom before handover, he said to me ‘make sure you’ve got insurance for the build’—I had completely forgotten to buy insurance!”

Living the dream

Olivia’s now in her new home but continues to stay focused on paying off her home debt.

Olivia says she keeps her finger on the pulse in terms of property news and she’s aware that mortgage stress is a growing concern among Australians. With the recommendation that a mortgage should be no more than 30 per cent of your annual income, Olivia’s currently sits at more than 50 per cent of her annual income. But she’s not worried.

“I have two housemates living with me and I am not living beyond my means,” she says.
“The savings I make from that goes towards my mortgage. In the end, what you do pay [on your mortgage] you would pay on rent, if you were renting, but this is an investment.

“Everything in my home is second hand, you don’t have to move in and buy everything new.

“Facebook Marketplace is my best friend. I don’t feel like I am sacrificing anything.”

Some words of advice

Olivia says that it can take about six to 12 months of solid saving to build up a deposit if you’re determined enough to do so.

“Work on your side hustles—tutoring here and there, house sitting—take any opportunity that comes up,” she says.

But if Olivia’s experience is anything to go by, it’s planning that is key to reaching your goal.

“Plan ahead,” she says. “Talk to experts—real estate agents, mortgage brokers and find yourself a good conveyancer who can look through all the ins and outs of your contract.

“Factor in all the costs, fences, landscaping, furnishings. Design or choose a floorplan that will maximise your orientation and the positives of your block.”

Olivia also says you should prepare yourself for all scenarios, such as if interest rates go up or if you lost your job.

“Always have a worst case scenario,” she says. “If I lost my job, I know I always could move back to mum’s and rent out my house.”

She also recommends reading Scott Pape’s “The Barefoot Investor: The Only Money Guide You’ll Ever Need”.

“I am super happy,” Olivia says. “I have never lived on a street, I have only lived on a farm—so it’s really nice to be around people.

In summary

At 22, Olivia Nicholls is now living in her brand-new Geelong Homes home in the popular hotspot of Torquay and is absolutely loving it.

Olivia started work when she was only 12 years old, managing to save a deposit for land by the time she was 18 years old. Surrounding herself with people who understood finance and property investment, she learnt that building provided great savings for first home buyers.

She chose Geelong Homes as her builder for three reasons: Geelong Homes’ personalised service; its seamless processes; and the fact Geelong Homes only hires local trades and uses local suppliers.

Geelong Homes also helped her choose the right home for her block of land that ticked all her requirements for a new home.

She says other young people can do the same with hard work and determination to save up for their deposit. And she recommends you plan ahead by surrounding yourself with a good team or experts. She also says you should prepare for all scenarios, including job loss or a rise in interest rates.

So what are you waiting for? If you want to take the plunge and join Olivia on the property ladder give us a call or drop into any one of our displays to speak with our new home consultants.

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