Interest rates will almost certainly go down further. The good news is home loans are getting cheaper – the bad news is prices in some areas are going up. And, of course, as happens every few years, there are voices coming from everywhere telling us young people can’t afford a home any more.

Guess what – nothing has changed that much. Buying your first home has never been easy, but it is certainly still possible.

First, get rid of the idea that home ownership is restricted to high-income-earners. Right now across Australia there are people who are doing it tough and there are people whose finances are in good shape. Guess what? Their financial position has got nothing to do with their income – it’s how they manage their money.

Managing your money gets back to choices. You can choose to take your lunch to work or buy it; you can choose to buy a new car or make do with your old one; you can choose to spend $35,000 on a wedding or $35,000 on a house deposit.

I am not going to go into a long list of money-saving strategies here – there are hundreds of websites and books that can do that. But it is important to stress that it is the choices you make, not your income, that will determine how well off you are financially.

If you decide to divert some of your income to investment, your net worth will grow. If you decide to spend it all on consumption, you will be forever battling the debt treadmill.

Once you have got your finances under control, the next step is to set yourself the goal of buying a home. If you are not strongly motivated, there are ways to build your desire to do this, in particular, thinking about what will happen if you choose one action over another.

If you decide to rent, all your life you will be at the mercy of the landlord – if you decide to buy a home you will be acquiring an asset that will grow over time and, when paid off, will give you free rent for the rest of your life.

After you retire, you could even take out a reverse mortgage and live off it.

You can also consider the unique benefits of home ownership. Australia’s population is predicted to increase by more than 10 million people in the next 20 years, which will create a strong demand for well-located properties. Furthermore, in some areas homes are now selling below their replacement cost. Given that scenario, it is hard to see anybody losing money over the long term if they buy a well-located property.

Once you have your finances under control, and have convinced yourself home ownership is a worthy goal, you need to set a specific plan to make that goal a reality.

The secret is to focus so hard on the goal that everything else becomes immaterial. Start by looking at homes where you would like to buy, and then hang photos of them on the wall where you will see them every day. Talk to lenders to find out how much deposit you will need, and then make a sub-goal to save that within a specified time.

If you were a couple each earning $850 a week after tax, you could decide to live on one income and bank the other $850 a week into a savings account. In just twelve months you would have $45,000, which would be an adequate deposit for most properties.

As your savings grow the success pattern you are forming will be reinforced. Mark my words – you’ll be more than adequately rewarded for your persistence.

Noel Whittaker is the author of Making Money Made Simple and numerous other books on personal finance. His advice is general in nature and readers should seek their own professional advice before making any financial decisions. Email:

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Posted by Noel Whittaker – The Age on 6th April, 2016