When to Start Saving for Your First Home as a Bricklayer

As a bricklayer, you're building homes for others every day – but when should you start building your path to owning your own place? The answer is sooner than you might think. With the right approach to saving and understanding your home loan options, homeownership is within reach.

Understanding Your Financial Starting Point

Before diving into saving strategies, let's talk about your financial situation. As a tradesperson, your income might fluctuate depending on projects and seasons. This doesn't mean you can't buy a home – it just means you need to plan smartly.

Start by reviewing your bank statements from the past six months. Look for patterns in your income and spending. This information will be crucial when applying for a home loan, as lenders will want to see consistent income patterns and responsible spending habits.

Your borrowing capacity depends on several factors:
• Your regular income (including overtime and penalty rates)
• Existing debts and commitments
• Living expenses
• The loan amount you're seeking
• Current interest rates

The Magic Numbers: Deposits and LVR

Most lenders prefer a 20% deposit, which gives you a loan to value ratio (LVR) of 80%. This means if you're buying a $500,000 home, you'd need $100,000 as a deposit. However, don't let this figure discourage you – there are other options.

With less than 20% deposit, you'll typically need to pay lenders mortgage insurance (LMI). While this adds to your costs, it can help you enter the property market sooner rather than waiting years to save the full 20%.

The Home Guarantee Scheme is particularly valuable for first time home buyer programs. This government initiative allows eligible first-time buyers to purchase with as little as 5% deposit without paying LMI.

First Time Home Buyer Schemes and Grants

Australia offers several first time home buyer schemes designed to help you get into the property market:

First Home Owner Grants (FHOG): Each state offers different grants, typically ranging from $10,000 to $15,000 for new homes. Some states also offer concessions on stamp duty, which can save you thousands.

First Home Super Saver Scheme: This allows you to save money for your first home inside your superannuation fund, potentially reducing your tax burden while building your deposit.

Choosing Between Variable and Fixed Interest Rates

When you apply for a home loan, you'll need to decide between variable interest rate and fixed interest rate options, or even a split loan combining both.

Variable rates fluctuate with the market, meaning your repayments can go up or down. Fixed rates lock in your interest rate for a set period, providing certainty for budgeting – something particularly valuable if your tradie income varies seasonally.

Many first home loans come with interest rate discounts for the first few years, which can provide significant savings when you're getting established.

The Application Process: What You Need to Know

The application process for buying your first home involves several steps. Getting pre-approved is often the first step, as it shows sellers you're serious and helps you understand your budget.

For the streamlined application process, you'll typically need:
• Recent pay slips and bank statements
• Tax returns (especially important for tradies with variable income)
• Details of any existing debts
• Identification documents
• Information about the property you want to buy

If you're considering investment loan options down the track, your first investment property application will require additional documentation, including rental assessments and more detailed financial information.

Maximising Your Loan Package

Different lenders offer various packages and benefits. Some include offset accounts, which can significantly reduce the interest you pay over the life of your loan. An offset account works like a savings account linked to your home loan – the balance reduces the amount of interest charged on your loan.

Access to banks and lenders nationwide means you're not limited to the big four banks. Many smaller lenders and credit unions offer competitive rates and more flexible lending criteria, which can be particularly beneficial for tradies whose income might not fit traditional employment patterns.

Planning for Additional Costs

Buying a home involves more than just the purchase price. Factor in:
• Stamp duty (unless you qualify for exemptions)
• Legal fees
• Building and pest inspections
• Moving costs
• Initial setup costs for utilities and services

As someone who works in construction, you might have an advantage when it comes to property inspections – you'll likely spot potential issues that others might miss.

Making Your Tradie Income Work for You

Your skills as a bricklayer can actually work in your favour when buying a home. Properties that need minor renovations might be available at lower prices, and your ability to assess and potentially fix issues gives you options that other buyers might not consider.

When lenders assess your application, they'll consider your trade qualifications as job security. The construction industry consistently needs skilled bricklayers, which works in your favour for loan approval.

Access home loan options from banks and lenders across Australia by working with a broker who understands the trades industry. They can help match you with lenders who appreciate the stability and earning potential of your trade.

The property market offers opportunities at different price points and locations. Don't feel pressured to buy in the most expensive areas – sometimes starting with a more affordable property in a growing suburb can be a smart long-term strategy.

With the right preparation and professional guidance, your goal of buying your first home is absolutely achievable. The key is starting your saving plan now and understanding all the first time home buyer programs available to help you succeed.

Call one of our team or book an appointment at a time that works for you to discuss your home loan options and start building your path to homeownership.