- May 8, 2024
- Posted by: legaleseblogger
- Category: Related News
Try Free Now: Legalese tool without registration
## Deciding between Renting and Buying in Auckland
Hi,
Apologies for bringing up a topic that may have been discussed before, but I find myself in a common dilemma that many young adults face.
I am currently 23 years old and living at home, feeling a bit stifled and eager to experience more of life. My goal is to move out within the next 6 months, prioritizing personal growth and experiences over saving money.
I have a strong desire to remain in Auckland, as it is where I feel most comfortable and connected.
### Exploring Options for Housing
I find myself at a crossroads with two potential approaches:
#### Option 1:
One possibility is to rent a room with a colleague for $200/week, or if that doesn’t work out, budgeting around $350/week for accommodation. I plan to invest my savings and residual income into an index fund, considering home ownership as a future possibility in about 10 years, potentially when I start a family.
#### Option 2:
Alternatively, I could consider purchasing a townhouse valued between $700,000 to $800,000. With savings of $250,000 and pre-approval from the bank ranging from $450,000 to $550,000, based on my income and financial situation, this option seems feasible. However, the prospect of finding a freehold standalone property within my budget in Auckland seems challenging, and townhouses appear to be the more realistic choice.
### AI Legalese Decoder for Sound Decision-making
Enlisting the help of an AI Legalese Decoder can bring clarity to complex legal terms and conditions associated with renting, buying, and finance in the housing market. By utilizing this tool, I can better understand the implications of my choices and ensure that I make informed decisions.
I am drawn to new build townhouses, particularly the options offered by Kiwibuild, such as their 2-bedroom units in Mt Roskill. Despite townhouses being considered less lucrative investments compared to properties with more land, they seem to be my best bet within my price range.
### Examining Financial Considerations
While the idea of owning a home and paying off a mortgage is appealing, I am mindful of the financial commitments involved. With projected mortgage repayments indicating a substantial portion going towards interest payments over the next decade, I am concerned about the long-term financial implications.
In conclusion, I am seeking insights and advice on bridging any gaps in my reasoning and decision-making process. Your input and perspective would be greatly valued as I navigate this important life transition.
Thank you for taking the time to read through this, and I wish you all a wonderful day ahead.
Try Free Now: Legalese tool without registration
**Current Situation**
In today’s legal industry, the use of complex and jargon-filled language, known as legalese, is still prevalent. This can create barriers for individuals who are not well-versed in legal terminology, making it difficult for them to understand their rights and obligations. Moreover, the use of legalese can lead to misunderstandings and misinterpretations, potentially resulting in legal disputes.
**How AI Legalese Decoder Can Help**
AI Legalese Decoder is a cutting-edge technology that is designed to break down and simplify legal language, making it more accessible and easier to comprehend for the general public. By using advanced algorithms and machine learning capabilities, AI Legalese Decoder can translate complex legal terms and phrases into plain language, helping individuals navigate the legal system with ease. This tool can be especially beneficial for individuals with limited legal knowledge or those who struggle to understand the intricacies of legal documents.
**Benefits of Using AI Legalese Decoder**
– Empowers individuals by providing them with a clear and concise understanding of legal documents and contracts
– Helps prevent misunderstandings and misinterpretations that can lead to legal disputes
– Improves access to justice by making legal information more accessible and digestible for all individuals
– Saves time and resources by streamlining the process of decoding complex legal language
– Enhances transparency and trust in the legal system by promoting clear and understandable communication between parties.
Overall, AI Legalese Decoder is a valuable tool that can revolutionize the way individuals interact with legal documents and contracts, ensuring that everyone has equal access to justice and legal information.
****** just grabbed a
Question, how the fuck do you have $250k in savings at age 23? That’s incredible
I’d really recommend renting at your age. I know it’s technically “dead money” but you’re going to find that the moment you move out of your parents’ house, you’re going to start growing and changing in all kinds of directions, and you’ll be a really different person in five or ten years. You’ll know yourself better, and have different priorities.
And flatting with different people is a great way of learning a) what kind of person you actually are, and b) how to successfully get on with lots of different personality types. It’ll make you a better partner when you do fall in love and marry.
[deleted]
i think you should only try buying a forever house when you have a partner as you want them to love it too.
Think of this house as an investment/experience. Townhouses are good for that.
My friend has been buying exclusively townhouses for investment property. They have managed to buy 2bed townhouses in mangere and Avondale area for ~650K range
Look at 2-5 year old houses not new ones and negotiate.
Live in it for a few years, knock off equity and rent it out when it’s cash positive.
Or just invest in index funds and not bother with property
Re Kiwibuild, I didn’t even really know if it was still going, but someone I know just bought a Kiwibuild place in January for 700k, and he had to get a valuation for the bank loan and it came back at 825k. This is a three bedroom townhouse + carpark in Māngere Bridge. He said there wasn’t even a ballot. If I didn’t already have a house, I’d be looking at this!
https://www.yourmoneyblueprint.co.nz/housing-2/2018/5/19/should-i-rent-or-buy-a-house
Don’t buy a townhouse in my opinion. I know it seems like a good idea in theory but it is not the be all and end all. They can be really problematic. I doubt they are going to go up in value in any meaningful way. The $30k p/a you talk about is not going to happen when you have properties with <100m2 land, neighbours on both sides, no parking, KO tenant issues etc. especially when they are starting at $700-800k. $800k is still a pretty huge mortgage ($640 with 20% down) and historically would be a monstrous component of the median income. In other words, just because some people are doing it, doesn’t mean it is sustainable – its a false economy. The construction industry is constantly evolving. For example, insulation requirements, window glazing, ventilation requirements, best practice cladding products etc. (go look up the leaky building crisis). There was an article about someone talking about how unbearably hot the upper level of their townhouse is because there is only a requirement for one heat pump in the property. If something goes wrong, it will be a nightmare to fix in the future as you are joined onto your neighbour. Consider the risk of obtaining insurance, the cost of maintaining the shared driveway etc etc.
At 23 I would highly recommend flatting with some new people to gain some life experience and also look at doing some travel overseas. For $200-250 you could find a pretty nice room in Remuera, Newmarket, Ponsonby etc. Quick easy commute, save on travel cost.
Keep working on increasing your income. Invest as much as you can. Re-evaluate 5 years from now.
Move out of Auckland
The problem with townhouses is that they can never be redeveloped – which makes the paltry land underneath your unit largely worthless from an investment perspective. The only value is in the dwelling … which will depreciate as the building ages.
If you need long term capital gain then find a way to buy an urban property with land. Ideally something with a slightly shabby or run-down house that sells at a discount. Then get flatmates or boarders (the heathy homes rules don’t apply to owner-occupied property) and wait for a couple of years as time to works its magic on the value of the land.
Factor in rates, maintenance, insurances, water rates & usage, utilities etc. NZ home ownership is nuts. So much $ wasted to the banks on interest if you don’t pay more than minimum and have a high mortgage.
Are you just following what most people think is the way of life? 8-5 job, buy a home, have a family?
Think about how you actually want to live your day to day life.
I hate townhouses, unless there’s like 4 units on the property with adequate parking.
Buying property is good if your long term outlook is in NZ. Rent will go up with inflation, mortgage payments will go down with inflation and value will go up. But it’s a long term play.
Forgot to mention I work in the CBD and prefer a commute that’s within 45-60 minute by Public Transport, which plays a factor into things as well.
How’d you get a 450k preapproval on only 70k?
I’d definitely buy if planning to live here long term
If you’re lost in life don’t lock yourself into mortgage. Keep saving until you’re not lost, then buy.
I would be cautious about buying a townhouse in Auckland. There are a lot with major issues (e.g. weather tightness) and many of the new townhouse developments are a small number of townhouses on what used to be one section, so they don’t have the same obligations for management as larger body corporates (some don’t seem to have body corporates at all) which means long term maintenance may not be planned or budgeted for.
Does the savings include kiwisaver? If not you can afford a 700k investment property. Look for a good yield to bring you to cashflow neutral today, becoming positive in the next few years as interest rates drop and rents rise. Hold for 10y and sell in early thirties to buy family home.
If buying a townhouse for investment then Chch is best – and move out of folks place and rent and learn about life! So much to soak up when only 23!