A 22-year-old youth worker from Hamilton managed to beat the odds and her spending habits to buy her first home.
Ohatu Jones faced stiff competition from half a dozen cashed-up investors for the three-bedroom house in Tokoroa, in South Waikato.
She even wrote a letter to the vendors asking them to consider her offer of $300,000. It worked, although she still can’t believe that she’s now a homeowner.
Jones explained to OneRoof how she did it, from saving for a deposit to finding a house that was within her budget.
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She told OneRoof she saved solidly for her deposit for two years, sometimes sending as much as $500 a week to her mum to look after so she wouldn’t be tempted to spend it. “I used to go on holidays, buy expensive stuff, I used to Uber Eats and then I had to cut it all off,” she said.
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And while she saved all the money herself, she said she wouldn’t have done it without the help and support of her family.
Her mum helped with her finances and finding the right house and her nana let her live with her for four months so she could bump her savings up to $5000.
The rest of the deposit comprised $20,000 of KiwiSaver that had accumulated since she took her first part-time job at The Warehouse at 16 years old. A further $5000 was obtained from the now-defunct First Home Grant, which she was approved for a week before the Government abruptly shut it down.
“It’s hard if you don’t have family you can stay with to save, but I just recommend putting your KiwiSaver at 10%.”
Jones had just hit her target of $30,000 for a deposit when her mum spotted a three-bedroom, one-bathroom home for sale about two minutes from their family home with an asking price of $265,000.
They had looked at several other houses in Tokoroa, but they were only two-bedroom homes on smaller sections and were more expensive.
The three-bedroom, one-bathroom do-up went into a multi-offer situation with seven offers made on it. Photo / Supplied
Jones decided to make an offer on the house which was listed with Property Brokers and found herself in a multi-offer situation where she was suddenly competing against six other investors for it.
Her mortgage broker, Jeff Kerwin, at Nest Home Loans, also helped her find the right bank and get it over the line.
She made an offer of $300,000, which was all she could afford, and included a letter to the elderly owner’s family.
In the letter she described how she had been saving to buy her first home at the age of 22 and how she could immediately feel the warmth of the house the first time she stepped inside.
She also told them how she wanted to create memories with her family in the large 806sqm backyard and how she loved the feijoa trees.
“My morals and my values are based on whanau and the location of your home is extremely beneficial,” the letter said.
Jones said she had been competing against investors, including some who had made cash offers.
But the family had told her mum that it was learning of her plight to get into a first home at such a young age that swung it in her favour.
The house was tired-looking and had an original kitchen and bathroom. Photo / Supplied
“The vendor’s kids had bought their first home at 22 and they knew how it felt to buy at such a young age so they just wanted it to go to a first-home buyer.”
She admitted she was initially reluctant to buy the 1950s ex-forestry home because it seemed like a lot of hard work.
“It’s the ugliest house on the street. [Mum] just said we can always do it up and it won’t be like that forever.”
Within a day of moving in, Jones and her family started painting the walls.
Her mum had also ripped out the kitchen and she had found a second-hand one to install using the cashback from the bank.
She’s also planning to install new carpet and hopes to have finished the renovations in the lounge and kitchen by the end of the year.
Jones and her family started painting the house within a day of taking ownership of the home. Photo / Supplied
“I just can’t wait to have everyone over. I think we are having Christmas at my house.”
The home’s exterior had weatherside cladding so she had also budgeted to replace this in the future.
Her house hunting initially began in Hamilton so she could be close to work, but she said she realised pretty quickly they were well outside her budget.
“You’d have to have two incomes to be able to buy a house in Hamilton.”
Even the surrounding towns such as Ngaruawahia and Huntly were about $100,000 more than Tokoroa, she said.
She shifted her focus to Tokoroa, which she said also had the advantage of having her family just down the road.
And while she could manage the weekly repayments of $600 a week, having her sister move in would also help ease the pressure, she said.
The $300,000 sale price was well below Tokoroa’s average property value, which was $420,000 at the end of June - up just 0.5% year-on-year and down 1.6% in the last three months, according to OneRoof-Valocity data.
The kitchen has also been ripped out and will be replaced with a second-hand one. Photo / Supplied
Jones’s advice to other young would-be first-home buyers is to keep saving and be realistic about what they can afford.
Her nan Rebecca Needham said the whole family was extremely proud of Jones for achieving her goal. Family was about helping each other and there was no way people in their 20s could get on the property ladder without support, she said.
“I’m 66 so they come in and take care of me when I need to. But at the end of the day you can’t row the boat without whanau in it.”
She was also pleased to see her putting the money towards her mortgage rather than on rent which she labelled “dead money”.
Ray White agent Richard Garner said Tokoroa was popular with first-home buyers because it was much more affordable when compared with the larger centres.
“We have seen a lot more first-home buyers this year. We’ve had people come from Rotorua, Hamilton and Tauranga.”
While some were moving in from the outlying areas, he said others were returning home because they were sick of “blowing money on rent”.
A liveable three-bedroom property could be picked up for about $380,000 to $450,00, he said.
The listing for a three-bedroom, one-bathroom home at 108 Richmond Ave with an asking price of $420,000 only went live on Tuesday afternoon and was already attracting interest from first-home buyers.
Garner said the cheaper the house the more work it needed, which could prove problematic for first-home buyers trying to get a mortgage.
“Some banks won’t let first-home buyers on those homes that need a lot of work. It’s a bit of a catch-22 as they need to start at a low level and work their way up through the market as we all do - your first home is not your last home sort of situation - but some of those restrictions on first-home buyers they find that what they can afford then the quality of that home the bank doesn’t want to lend to them particularly.”
- Click here to find more properties for sale in Tokoroa
