How Millennials Can Prepare for a Real Estate Investment

If you’re a millennial thinking of venturing into the real estate world, there’s a few things you need to learn about before taking your journey. You might be already drowning in student debt, and generating low income, however, knowing how to make your process easier will ultimately help you stress a little less and reach your goal a lot faster.

Think about long term property value

The first step you can take is to do your research and to find a location that matches affordability with long term equity (value) growth potential. Once you figure out where you would like to see yourself living, plan around it. Find out about the local community, restaurants, malls, gas stations, neighbours and school districts. Setting a goal for yourself will not only help you narrow down where you want to live, but make your agent’s job easier in finding what you’re looking for.

Increase your credit score

There is a good chance that your credit score may not be as good as you would hope for it to be due to student loans, job insecurity, or unstable financial circumstances. If you plan on making your purchase within the next few years, it would be a good idea to spend the time leading up to it building a good credit score. Money lending officers will scrutinize your credit score and decide whether giving you a loan would be a good fit for them. Spend some time planning your finances and learn to discipline your spending habits.

Save up

Saving up could be a challenge especially if you are a millennial with student loans. But being able to save can be a testament to your self-restraint and what you can accomplish when you set your mind to it. Taking out a percentage of each of your paychecks and stashing it away, paying off high-interest loans first, making bigger minimum payments, and spending the rest on necessities will help you save a lot quicker.

Know the market

Start out by knowing your budget and how much you’re willing to spend on your home. Match this budget to what your desired location of stay is and work around it. Learn about how long it takes the houses in that area to sell, how many times they’ve been sold, and if the price ever drastically changed. Knowing all this information will validate which home will be the best investment.

Tips on Finding Affordable Housing for Millennials

According to the Globe and Mail, housing sales in the Greater Toronto Area plummeted by 50 per cent for the first two weeks of June compared to the same period last year. It has been difficult for students and recent graduates to find affordable housing within the downtown core. Here are a few tips on searching for a new home in the city.

Research: Try to analyze the housing markets and the price range of specific neighborhoods. Consider the type of housing you’ll be able to afford whether it is an apartment, townhouse, or condo. Move-in fees, pet policy, and insurance are other costs to consider when moving in.

Budget: Make sure expectations match your financial reality. Find a housing unit you’ll be able to afford throughout the years by creating a budget plan. Creating a breakdown of every monthly costs will help you set an ideal price for your rent.

Negotiate: If you’ve found affordable rent, there’s a possibility that you’ll be able to bargain the costs with the landlord.

Find a roommate: Especially if you’re a post-secondary student, you’ll be able to save more money by having someone to support the cost of rent. Finding someone trustworthy will help you budget the costs throughout the year.

Seek Advice: Whether it’s from a close family or friend, ask for help to find when shopping around. They might have good advice to give on where to look, and advice on things to consider when searching.  

 

Tembo Money Tips for a Rainy Day

Here are a few tips on how to save money in case of a bump in the road or a rainy day. It’s always important to consider ways to save money. These easy methods can make a huge difference in your savings and spending habits.

 

Move bank accounts

If you’re paying a monthly fee for your checking or savings account, you would benefit from researching some of newest banking offers out there. Not only do some banks offer sign-up bonuses simply for opening an account and setting up direct deposit, but some offer attractive interest rates to new customers as well or maybe even no fees.

Pay Yourself

Designate a certain amount of your paycheque as your pay and try to be disciplined in spending within the amount. Absolutely be sure to pay your bills and keep up with your responsibilities but try to allocate a piece of your pay that you are comfortable with so you can develop discipline and begin to save.

Automate your finances

If paying yourself first won’t work, consider talking to your bank about automatic deposits into your saving account. Your bank will automatically transfer a certain percentage of your paycheck into your savings account every time you get paid. You can also use automated services for paying bills.

Prepay your debt

You can save hundreds of dollars if you put more towards your debt, and avoid the high interest rates. Increasing your payment by even the slightest can save you a good amount in interest costs.

An emergency, accident, workplace change, increase in debt costs, or higher interest rates are all potential scenarios to keep in mind and to be prepared for. It’s always wise to better manage your money and to be mindful of the financial unpredictabilities of life.