OPINION: You know you’re on the downside of the journey of life when you start using the phrase “when I was young”. These words are sometimes used with the best of intentions — but more often, than not, they’re the precursor to a criticism of current attitudes and behaviour. For example, when people over 50 use that phrase in relation to the housing market, they’re often comparing what they were prepared to accept when they bought their first home with what young first-home buyers expect now. No doubt you’ve heard them on talkback.
“When I was young we were happy with a tiny home, not much bigger than a box, with no furniture and none of these fancy appliances. But young people, now, want their first home to be a flash house in Ponsonby (or Khandallah, or Fendalton) with all of the modern fittings. And they wonder why they can’t find a house!”
It’s a familiar and simplistic claim that makes oldies feel better about themselves and the sacrifices that they made — but is it true?
Yes, and no. Certainly it’s true that this generation of buyers want to be more comfortable than their parents and grandparents. But so did my generation. My grandparents used a wringer washing machine and had one TV channel and no internet. Would I have been happy with those things? Of course not! Seeking to improve our lot is part of the cycle of life. But the idea that most young people expect their first home to be in the best suburb is largely nonsense — and for many of them, simply securing that elusive first property is hard enough without setting such an impossible bar for themselves.
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There are some attitudes that many buyers take into the process that are probably not helpful — and taking a more pragmatic approach could avoid a lot of disappointment. For example:
1. Auctions are usually hard for first-home buyers
During boom markets, vendors use auctions as a way to maximise competition by bringing it together into one room — so it shouldn’t surprise you to find yourself outbid a few times. This isn’t a flaw in the system or a sign that the universe is conspiring against you — it’s simply an indicator that this method of selling works exactly as it’s supposed to for those who are selling their property.
You can either keep trying, or focus on properties which are sold another way — such as by tender, or with a listed price.
2. Your first home is almost certainly not your last
Few of us go into our first job expecting to be the CEO. Instead, we see that first step in our career as an important start to a lifelong journey, in which we will usually make our way up the ladder. Your first home serves exactly the same purpose. It’s the mechanism by which you’ll get on to the first rung of the property ladder and start to develop equity which, over time, will help you to get into your next property. If you can keep this in mind you’ll be more realistic in the approach you take to that first purchase.
3. Your first home won’t be your dream home
For similar reasons your first home is extremely unlikely to have all of the features that you’d like it to. Instead, it will probably provide you with some fairly clear ideas about what you like and don’t like and a more focused idea of what you want when it comes time to upgrade to your second or subsequent home.
4. Perseverance is the key
For most of us, buying your first home is hard. It takes time and patience and will come with its share of tears. Push through — it’ll be worth it.
5. The system works
The property market isn’t broken and doesn’t penalise one sector over another. Left alone, without Government and Reserve Bank interference, the market does exactly what it’s supposed to do and develops wealth, security and comfort for the vast majority of New Zealanders. If you go into your first home buying adventure with patience, a strong resolve and sensible expectations you’ll win through. Best of luck.
- Ashley Church is a property commentator for OneRoof.co.nz. Email him at [email protected]
