Finance tips for first-time, young homebuyers
Considering the fact that approximately one in two 18 to 34 year olds still live at home with their parents, buying property is challenging for young adults. This, however, does not mean that you can’t invest in property. Here are key finance tips for young adults.
Finance tips for first-time, young homebuyers
Old Mutual’s Savings & Investment Monitor for July 2018 reported that about one in two 18 to 34 year olds live at home with parents. The inconsistency between entry-level salaries and the rising cost of living is making it difficult for young adults to become fully independent.
“At some point, parents also need to start investing more in their own retirement so that they don’t later become a burden to their children. Unless your adult child is contributing towards rent and household expenses, it might be beneficial to both yourself and your children to encourage them to find a place of their own,” says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
Goslett says the most common reason choose to not move out of home is that they cannot afford to. He says while this may be true for some, especially those below the age of 25, this is certainly not the case for all.
“If you know where to look, you can get away with around R5 000 in monthly rent for bachelor flats and house sharing options. Many rentals include water and electricity costs, so other expenses would only include things like grocery bills, which you can budget at around R1 000 to R2 000 for one person depending on buying and eating habits, and fuel and transport costs which will vary from person to person,” he says.
Gosling says if you make the calculations, anyone earning over around R10 000 a month would be able to afford the costs of moving into their own place.
