Stop renting sooner

Rent Price Index Trade Me

Housing shortages were a hot topic in 2016, and not surprisingly high rents have now hit the headlines. Immigration and a lack of housing stock resulted in the average rent for a typical New Zealand house hitting $500 for the first time in February 2017.[1]

Interestingly, the largest rental increase was in the Bay of Islands, where average rents rose from $340 to $465 – adding $6,500 to the annual cost of renting.  Typically, New Zealanders are now paying over $24,000 a year in rent for a 3 to 4 bedroom house.

We know that paying high rents while saving the deposit for a house can be challenging and there is no shortage of suggestions on how to save more – two minute noodles anyone? But successfully saving for your own home is not only about how much you save, it’s also about where you save. Saving in the wrong place is one of the reasons why so many Kiwis have been locked out of the housing market.

There are many places where you can save, the most common of which is a bank savings account or term deposit. Unfortunately for many Kiwis there has been a huge gap between the growth of their savings deposited in a bank account compared to the growth of the housing market. Their savings have become out of step with the housing market and in real terms they are going backwards rather than moving closer to achieving their savings goals.

The Ownery is a new way of saving – one that allows you to save in houses so your money moves with the market. Regular saving is still an important part of the equation, but by saving directly in the housing market you won’t get left behind. And you can enter the housing market for just $500, saving regularly with small amounts to build a deposit for your own home.

 

[1] http://www.trademe.co.nz/property/price-index/for-rent/

 

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