Buying a home on one income

Buying a home is a big goal for many New Zealanders. But if you’re a single person, or a single-income family, it might feel a little harder to make this a reality.

Take heart – it is possible to buy your own home with just one income, although you may have to strategise a bit more, or work a little harder, to get there. Here are a few things to think about.

Maximise your income

The first thing you may want to do is make the most of what’s coming into your bank account. Lenders don’t mind whether you have one income or two – what matters is that you have enough income to meet your living costs and  service a home loan.

If you’re relying on one income to service a mortgage and save a house deposit, you probably need to make sure it’s as good an income as possible. 

That might mean making the case to your employer for a pay rise, or considering taking on another job for a period of time to boost your earning power. 

Minimise your debt

If you have debt, the repayments required reduce the income you have available to pay the mortgage. So, it’s a good idea to try to get rid of it as soon as you can, especially if you have high-interest consumer debt. 

Do you have a student loan? Even though a student loan is interest-free, it reduces your net income, so it may also make sense to pay yours off if your servicing is likely to be tight. We can help you work out whether that is the case for you.

Maximise the assistance available

Make the most of what is available to you, to help you in the door. For example, check if you’re eligible for a First Home Grant or First Home Loan. If you are applying with a single income, you can earn up to $95,000 as an individual buyer or $150,000 if you have one or more dependents. A First Home Grant will give you up to $10,000 if you are buying a newly built home, and a First Home Loan reduces the deposit you need.

Identify where you might be able to buy

It’s possible that you won’t be able to afford the same sort of property as a single-income purchaser that you could as a dual-income buyer. 

Work out what sort of budget you could expect to be working with, and consider what properties might suit. We can help you determine what you are likely to be approved for, to help guide your search.

Get help

Buying a house is exciting but it can also be a bit daunting if you haven’t done it before. 

Having an expert on your side can make all the difference. When you assemble your first-home buying team, including a lawyer and maybe a property inspection expert, add a mortgage adviser to the mix. We can help ensure your transaction runs as smoothly as possible.

Ready to get going?

We’re here to help you. Give us a call or drop us an email today and we’ll help you on your way to homeownership.

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.