Flying solo— The challenges and triumphs of buying a property on your own.

The crowd stands huddled in the driveway, bracing against the crisp autumn breeze. Nicole studies them. They’re a mix of couples, some young and flushed with the excitement of purchasing their first home, others older with the steady gazes of people who have done this before—downsizers with the equity and experience that comes with age. And then there’s her. Her sister came with her for support the first few times, but as the auctions rolled on, one after the other, enthusiasm waned. So here she stands, in front of the perfect 2 bedroom home, in good nick, ostensibly within her budget, in the location she wants, but there are no butterflies.

The auctioneer begins, asking for opening bids—there’s silence. It lingers. A flutter of hope emerges in Nicole, she raises a hand. This could be it. Then the bidding war begins, two couples enter the fray and though she affects a sense of control and determination, sweat begins to bead on Nicole’s brow, because this has been the story every time. She’s well paid, has a solid deposit and a great credit history, but she just can’t match the buying power of a two-income family.

This is a challenge faced by singles across the country, as people delay getting married and choose to get into the property market on their own.

Current statistics show that 31% of new mortgage applications are lodged by individuals seeking a home on their own. Single women lead the pack, with 21% of applications vs 10% from single men. According to Clarity Financial Group Managing Director Mark Edlund, this pattern has been pretty steady for a decade. This trend for women to enter the housing market alone is matched by another, more single women take out life insurance policies than single men.

“Anecdotally I would say that men have a tendency to think they’re bulletproof, and from what we see in our business it seems as though women are more responsible than men when it comes to money. There is a strong desire for independence. They want to take more control of their lives, and so often purchase their own homes as a means to achieve that.”

Being approved for a mortgage as a single woman has changed significantly since Sex in the City’s Miranda faced the Spanish Inquisition when trying to buy her own apartment. In the 1990s the Uniform Consumer Credit Code came into effect, removing any bias in the way banks processed loan applications, preventing any discrimination based on gender, religion or ethnicity. The only way being a female affects mortgage approvals these days is the gender pay gap. Clearly if you earn less, you can borrow less.

“We don’t see a significant pay gap in Canberra compared to other cities we work in,” says Mark. “There are a lot more women in senior roles here than anywhere else. However maternity leave is a greater problem today than it has ever been. Future plans to have children will affect your borrowing capacity. Some banks simply won’t take maternity leave pay into consideration so we avoid those lenders in our recommendations and match you up with the bank most likely to approve your application.”

Regardless of gender, there are struggles that both men and women face when going it alone. Their borrowing capacity is not as strong. Not only do they usually have less income, but their cost of living is higher than a couple, who have shared expenses. Where a couple can usually borrow between 5 – 5.5 times their annual income, an individual applying for a loan can only borrow 4.5-5 times their income. This can put them at a disadvantage when competing with couples at auction.

26 year old public servant Jessica found a way around the fierce competition at auctions by choosing to buy off the plan.

“With new suburbs being built, I thought it was a good opportunity. I had been working full-time for a few years and saving what I could. I didn’t want to pay someone else’s mortgage. I didn’t even think about waiting to buy a house until I had someone to buy it with. I had the money, it was a good time, and I wanted to do something for me.”

But it did have its challenges. Buying on her own meant tackling the banks and real estate market solo.

“There was no central place for me to go that told me how to go about buying a house. I was lucky enough to meet a fantastic mortgage broker who helped me through the whole process and made me feel comfortable about the big decision to buy a house (at the time I was only 24 years old).”

Although it’s a daunting prospect for many at first, finding the right person to talk through the process can make the world of difference. Licensed real estate agents are intimately familiar with government regulations, conveyancing and property law as well as all related subjects like building inspections, energy ratings and disclosure requirements and are happy to walk newbies through it all.

Despite the challenges facing them, there are things that singles can do to increase their chances of getting in to their own homes.

As Mark says, “When assessing a home loan application banks consider a whole range of personal factors but focus on two main things – income and deposit. A demonstrated savings history proves that you’re willing to make the sacrifices needed, and that you have discipline. An individual who’s proved they’re willing to live on 2 minute noodles and reign in their lifestyle is statistically a lower credit risk than a couple whose deposit has come via a gift from mum and dad.”

“It can be done,” says Jessica. “You just need to adjust your lifestyle so that you are still being social, but not spending so much cash. When we went out at night I would drive, not drink. I’d cook at home for people rather than going out, and instead of hitting up cafes for breakfast, I’d go for a walk around the lake instead.”

“I’ve been in my home for a year now. Sometimes I lie there and think ‘Who let me buy a house? Seriously?’ but the experience has been great. I’ve taught myself how to build a retaining wall and pave a courtyard; I’ve learnt so much about things I’d never thought of before, like body corporate and rates. It was definitely worth doing it on my own—and not nearly as scary as it seems.

I would recommend shopping around until you find a mortgage broker you feel comfortable with. I’ve also learnt that you can get capped conveyancing services which I would highly suggest!”

So if you’re single, and toying with the idea of buying your own home, get onto it! There are affordable properties on the market now. Some new projects allow initial deposits of as low as $1000 with 12 months or more to save the balance of 5% so there’s never been a better time. We have agents who specialise in helping people buy their first home or contact a professional mortgage broker, such as Clarity Financial Group and take the leap.

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