‘Use the 8/10 rule’: how Xander bought his first home on his own

Owning a first home can feel way out of reach – especially when you’re searching. It’s easy to think ‘I’ll never get there alone!’ But Xander did it: he went from a first-home dream to a first-home reality, and he didn’t feel like he had to cut out too much of what he enjoys to get there. How did he do it? We chatted to Xander about the moment it all became possible, the decisions he made along the way and his tips for anyone looking to get a head start on their own first-home journey.

Hey, Xander. So, when did you realise buying a place solo would be possible? And what made you want to do it?

Buying a home has been important to me for as long as I can remember. Having my own place is the pinnacle of success. But when you’re young and not making much money, it does feel like you’ll never get there.

I realised it might be possible only a couple of months before I did it. I thought that I needed to have a 20% deposit saved, and I was like, “I’ll never get there!” But I did some research, and found out that if I paid lenders mortgage insurance (LMI) with less than a 20% deposit, I can do it now.

Once you were like “Right. Let’s do this!”, what were the first steps you took?

The first thing I did was find a home loan expert for advice. Someone I could trust and talk to. Then, I reached out to a conveyancer. She was really helpful in reading strata reports and all that kind of stuff. It’s great to get that team of people around you that you can talk to and bounce ideas off. So I talked to them, asking detailed questions about how the whole process works – all the little intricacies. Then I started going to properties. I started looking before I had pre-approval, just to get a feel for it and see a few auctions to get a sense of how it worked.

Sounds like you hit the ground running. How long was it between deciding you were going to buy to having the keys in your hands?

It was late January or early February when I said, “Okay, yeah, this is possible.” And the property settled on the fourth of May, so it was relatively quick. I spoke to a few experts to find the right help, which took maybe 10 days, then I got pre-approval, which took around two weeks. And from there I really started looking. It didn’t take long!

Were there any hiccups or stumbles along the way that threw you off course?

It all went fairly smoothly. You miss out on a few things here and there. Like when you’re looking at a few different places at once and then you’ve got this auction over there, the biggest challenge is managing your priorities and focusing your attention.

It gets a bit mixed up juggling auctions and private treaties. In the end, I worked out that I had to put all my eggs in one basket and say, “This is the property I need to go for.” So it became about finding the place that ticked 80% of my boxes and just going for it – because you’ll never find the perfect property unless you’ve got an unlimited budget.

At what point along the way did you need the most advice? Was there any point in time when you talked to someone more than at any other?

Yes, when I needed the conveyancer. That stuff was out of my depth. I was really fortunate because my conveyancer was my partner’s brother’s girlfriend. I could get on the phone and call her all the time with questions. I really wanted to understand that process. So I got a lot of advice out of my conveyancer. She helped me a lot.

Is there anything you’ve learnt from your life that’s helped you through the home-buying journey?

I live my life by this 1% rule – it’s 1% better every day. And this translated to how I had my savings account set up. It was important to know and tell myself, “Here’s your spending cash, the rest is savings. You can’t touch it.” Having a dedicated saving system in place is what made me realise the dream. Plus, it’s guilt-free spending when you know you can do what you want with it.

People always say, “Oh, what sacrifices did you have to make?” But I don’t feel like I had to make sacrifices. I was still going out for brunches, I was still going out for drinks with my mates, I was still buying coffee. I definitely didn’t give myself as much money to spend as other people, but I was able to go out and not feel guilty about it. I felt better. I had more control.

So here’s the exciting bit. What did it feel like to get the keys and step through the front door?

Back on the day of purchase it was the craziest feeling ever. It was pumping down rain – it was such a miserable day. And it was the weirdest feeling after the auction. I wondered, “Did I do the right thing?” I had a moment of massive anxiety, but then the next morning I was like, “Awesome. This is so good.”

Then picking up the keys and opening the door and just walking around – it’s the best feeling. Just thinking, “All this is mine. I can do what I want with it.” It’s really cool, just feeling comfortable in my own home. If I want to stay here for five years, I can. If I want to move back out and go to a rental, I can. I have the freedom to do that.

Along the way, were there any steps in the process when you were like, “Yeah, I nailed this”?

Accepting the fact that I was going to pay LMI. It was worth it for me. I’ve already made it back in capital gains, and a few times over. At the time I was like, “Oh, it sucks.” But it generally just gets attached onto the mortgage. If you have the luxury of having a 20% deposit, great. If you don’t, consider it. If you think prices will continue to rise in your area, the longer you sit out on the sidelines and wait, that required deposit might be going up anyway.

Another thing I feel like I nailed was making the decision to dive into it head first and just back myself and go, “Look, I’m just going to go for this. I want it.”

I can be the type of person who would’ve sat around and waited for the perfect property. But it helped to tell myself, “Mate, you need to get something that’ll tick 80% of your boxes.” So I wrote out a list of the things that I want. Some flexible, some non-negotiable. If I didn’t do that, I’d probably still be looking today.

And finally, having a good team around me was great. I listened to my friends and family a lot, but interestingly I didn’t take their advice wholeheartedly, because they’re not all in the same position as me and they’re not looking for the same things. So you have to, I guess, pick your advice. You’re not buying for anyone else, you’re buying for yourself. So be choosy about what you listen to.

What other tips do you have for someone else who is considering buying their first home solo?

In the months before you’re thinking about getting pre-approval, start researching, and even just start looking at

Go through and look at sales and get a sense of a property’s listed price versus the price it sells for. Also, pop along to a few auctions. You don’t have to spend every Saturday, but go to a few open homes and just see what it’s all about. This will help you understand the market better. After all, no one wants to spend more time looking than needed and get heartbroken when something sells for a price out of reach.

Xander’s five first-home buying tips
  1. Make a savings plan. Remember: “Here’s your spending cash, the rest is savings. You can’t touch it.”
  2. Consider paying LMI. If it’s the difference between buying now and buying later, seriously consider it.
  3. Use the 8/10 rule. No property is 100% perfect, but if it’s 80% there you’re very close.
  4. Get a team around you. Conveyancer. Home loan expert. Family and friends. All can help you in this journey.
  5. Do your legwork. Even before you’re ready, research to get to know the market.

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