Jul 21, 2017 7:00:00 AM

How to keep moving up the property ladder

Topics: Buying, Mortgage, new zealand real estate, First Home Buyer, Second Home 0

There’s a lot of focus on first home buyers, with Government incentives designed to help save a deposit and get a foot onto the property ladder. Second-steppers – those who already own a home and are looking to upsize or upgrade – are sometimes overlooked. If you’re one of the second-steppers trying to move up the property ladder, here are a few ways to do that.

Use the equity in your home

Most people assume that once you own a property, it’s easy enough to keep moving up the property ladder. That’s not always the case, but there are a few strategies that can help you climb a little quicker.

As a second-stepper, you’re already in a much healthier financial position as you don’t have to work nearly as hard to build up a deposit when considering buying your next home. If your current home has risen in value thanks to rising property prices in your area, you may already have enough equity to cover your deposit. What’s more, having already established a good borrowing record, securing finance for your next home is that much easier.

If you don’t have enough equity in your existing home, you’ll need to boost this with savings which means you may have to put your moving plans on hold until you’ve built up a sizeable savings fund or you’ve paid a little more into your existing mortgage.

Look for a deal

One way to get keep moving up the property ladder is to look for a deal – a property that may need a little work but will ultimately bring in the bucks if you spend a little time and effort on it.

You could try buying on the outskirts of a desirable area where properties may be more affordable but likely to increase in value over time, or buy “the worst house in the best street” and renovate or refresh to bring it up to standard. Sometimes just modernising a kitchen or bathroom, a decent paint job or a garden clear out can improve value and help build equity, so try to look beyond the imperfections.

Refinance your home loan

If you are thinking about moving up the property ladder, it’s a good time to review your existing home loan and think about refinancing. You should also compare your existing home loan with any new deals on the market as there could be an opportunity for improvement.

Working with a professional mortgage adviser from the start can help set you up with the right home loan to maximise your investment. Talk to a Mortgage Express adviser about arranging your finances to ensure you’re getting the best deal possible.

Resources:

http://www.stuff.co.nz/business/money/6449141/Smart-ways-to-climb-the-property-ladder

https://www.aussie.com.au/blog/one-rung-time/

http://community.renovate.com/post/How-To-Climb-The-Property-Ladder-Like-A-Pro-1


Disclaimer:

While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken by Mortgage Express Limited for any errors or omissions. This publication does not constitute personalised financial advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication.

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