There’s a mindset trend among first home buyers, and it’s not a little trend. There’s a trend toward high expectations – unrealistic expectations – that lead to disappointment. So we want to prepare and arm you.
The Disappointment
During the property buying process, many first home buyers become emotional when they find out the reality of their borrowing capacity – the limit of how much lenders and banks would be willing to provide you.
Feeling let down is okay. It’s all part of the journey. Think of it like this: every stumble is just a step towards success. We have to embrace those setbacks, learn from them, and keep moving forward. We have to face them head on, and find work arounds. There is no success by burying our heads in the sand.
The Decision
Let’s have a conversation about overcoming a lower borrowing capacity than what you anticipated, what you desire. There are three things that are going to come under close consideration for you.
Firstly, the area that you want to buy in, the location. You might be able to find a property at the price that you want, but it’s not going to be the type of home that you want.
Secondly, you may get the area that you want and the property that you want, but it’s not going to be the price that you want or can even afford.
Thirdly, you may find a property at the price point that you want and the type of home that you want, but it’s not going to be in that location that you want.
This is an adult conversation and you need to understand the selection criteria that you’re going to face, because at the end of the day, our hopes, dreams and ambition will always meet the harsh reality of our budget.
The Mindset Challenge
Don’t freeze. When faced with fear, upset, or disappointment, people can fall into the trap of fight, flight or freeze mode. The worst thing a first home buyer can do, particularly in this market, is stop their property journey altogether.
What you need to understand is that you can have everything that you want, but you it may not be when you want. You need to select from the best that you can, in the situation that you are in, and allocate your dream home to a future slot in your plan.
We find that students who don’t move forward when faced with their borrowing, struggle with accepting the realities of their budget, and the realities of their financial situation. If you don’t accept your situation, you can fall into the trap of making poor decisions or you may stop your financial progress entirely.
The Danger
There’s danger in not moving forward. What many people don’t understand is when they don’t take a step forward, when they choose to never purchased property, they’re left standing behind. They create a loopback for the family; they don’t own property, so they children never owned property. All because they looked at the first property like it is going to be the only property that they were ever going to own.
Property prices, historically, only go up. The longer you wait, the more you pay, and at some point, you may have missed the boat entirely.
The Long and High View
The answer to a limited mindset, and the danger it presents, is to shift away from thinking about your first home as your dream home, or your only home. Instead, plan to buy multiple properties and commit to a long term property journey.
When you’ve never owned property, you may not consider that the property you don’t like right now… it will go still go up in value. When the property you don’t like goes up in value, it enables you to use that value (or equity) to buy something else, getting you a step closer to the property you dream of. And one day, you will get to a point where you have enough budget to buy the dream property; in the area you want, with the features you want, and at the price that you have the capacity to buy.
You will buy you dream property; it may not be today, but with the right approach and mindset, it is possible. The first step is clear: patience and humility. Just because we can’t have everything we want, right now, does not mean that we can’t have everything we want with a little bit of patience and humility.
All you have to do is start the journey; one step at a time.
