You’ve probably thought about owning a house one day.
After all, there are plenty of excellent things to say about the prospect. You can proceed with your life feeling safe in the knowledge that you have something fundamental sorted out. You can wade into the satisfying waters of home renovation. You can play music at modest volume levels without bothering anyone. If there’s hard flooring, you can even indulge in an unseen Tom Cruise sock-slide.
But is it something you should be thinking about now? 2020 is the de facto annus horribilis of recent memory, after all, with COVID-19 taking so many lives and ruining many more through its varied repercussions. The global economy has collapsed, levels of disposable income aren’t exactly flourishing, and we can’t know if (or when) things might get worse again. Does that sound like a good foundation for a major life-changing commitment?
Well… Yes, I think it does. And if you stick around for a short while, I’ll explain why this second right now (yes, this one now) is the right time to start saving for a house — and offer some tips for managing it effectively. Shall we begin?
The sooner you start, the sooner you’ll be ready
Unless you’re a compulsive gambler or a contract worker in a hyper-niche industry with lengthy periods of inactivity followed by massive payouts, you’re going to make money at a steady and unexciting pace.
In principle, you can square away a certain amount each month, so this is a very simple mathematical argument. The sooner you start saving, the sooner you’ll have enough to cover a deposit for a house in your preferred price range.
Consider that you don’t need to buy a house at that point. You can just keep hold of that money, leaving it in reserve and adding to it incrementally until the right time arrives. We don’t know what’s going to happen with house prices in the future, regardless of what the predictions say. They might rise slightly, fall significantly, stay largely the same… It’s all but impossible to say with any confidence. This is what makes it hard to plan a house purchase way ahead of time.
If you have your deposit money ready, then you can follow the housing market, wait for a decent time, then pull the trigger at an opportune moment. If you don’t, then you might end up seeing a great chance come along and pass you by without having any opportunity to benefit from it.
If you wait for the ideal time, you’ll be waiting forever
Even as you accept that this sounds sensible, you might think it fair to kick the can down the road. Why not just start saving later? Chances are that your perfect house-buying opportunity won’t come along for a while, and you can always figure something out when it arrives: find a new way to make money, perhaps, or engage in some crafty negotiation.
The biggest problem with that idea is that there won’t be a perfect house-buying opportunity. It doesn’t happen. There won’t be an ideal place, an ideal price, or an ideal time in your life. There will always be some kind of compromise. You’ll choose a place that doesn’t quite gel with your identified preferences, but is close enough that you can make it work.
And once you accept this, you have to see the house-buying process as what it is: a fairly humdrum and practical series of events that you manage through planning and patience instead of fevered scrambling or the pursuit of fairytale twists. Don’t expect magic to happen. Start saving today, keep an eye on the market, and put in an offer when your gut tells you it’s time.
How to start saving for a house
There’s just one secret trick to saving for a house, and it’s all you need to get it done. Here it is: start saving money.
It truly is that simple. Spend less whenever possible, look for ways to make extra money, and put everything you can spare into a safe account. You don’t need to invest in anything risky or participate in any questionable schemes. Just be sensible.
This isn’t a very satisfying thing to note, of course, because it accurately reflects the typical duration and difficulty of a first-time buyer’s journey — and aren’t special tips supposed to tell you how you can make something easy? No such luck, unfortunately. Cut your luxury budget, work some overtime, and bide your time. You’ll get there eventually.
And if you’re just not making enough money? Well, it might be time to reconsider your career path. Reinvention would be tiring, but could greatly improve your chances. Think carefully about what else you could do in your current field, or what other jobs you might be good at — then look around to see what openings are available, or even go into business for yourself. The path of becoming an entrepreneur is very accessible these days.
It may not seem it initially, but now is totally the right time to save for a house — and by following the tips above, you might just get there quicker than you think.