Mr Taxman
Change the way you feel about taxes.
Get informed and discover what the taxman doesn't want you to know.
Sharing it with Australia, Mr Taxman is a regular Woman’s Day columist and TV finance commentator
  • click to visit Mr Taxman on Twitter
  • click to visit Mr Taxman on FaceBook
  • rss

Renting a property

Feb 15, 2011

I have been renting for a few years now and fearful of staying in the rental rut forever and not being able to buy my own place.  How can I get ahead?

Ange, Double Bay

It may be cheaper than a mortgage repayment but rent money is dead money. 

Whereas you can have a house paid for in full after 30 years, rent still needs to be paid week in, week out and you have nothing to show for it.  And you can be kicked out onto the street by the landlord at any time!

It is not easy to get into the housing market these days so you need to make drastic changes to your current lifestyle and budget in order to get out of the rental rut.  If you can't get any extra income via a second or higher paying job, then you need to slash your costs.

The best way to save for a house is to go back to live with mum and dad.  But sometimes that isn't possible so the next best thing is to live with a few people.  Enjoy the benefits of economies of scale of sharing costs of running a household.  Make sure that you screen who you live with for security purposes but also so they are not the type of person to leave with outstanding bills.

I don't know how much you are currently paying, but going by your postal address you are probably paying a higher rent than you would for similar accommodation in less affluent suburbs.  Sometimes we need to make sacrifices in order to get ahead and I suggest that you consider picking a cheaper suburb to live in.

Living in a cheaper suburb may also reduce the temptation to go out to cafes, restaurants and shops as a result.  Nicer suburbs create a tendency for wanting to go out more often, especially mid-week, and experience the social lifestyle which is quite damaging to your savings plans.  Be disciplined and save as much as possible.

We all wish we could buy a mansion by the water but it is unrealistic having such high expectations.   Rome wasn't built in a day, and you may need to slowly get into the housing market rather than go straight to the top with your first purchase.

Tags: Property

Author: Mr Taxman

Comments

Post a New Comment

Media Availability

Are you interested in booking Mr Taxman for a speaking engagement or requesting his viewpoints for an article?

comments-rhsLatest Comments

  • "Hello everyone am here to testify how i got my loan from Mr.Henry walter after i applied several times from various loan lenders who claimed to also testify right in this forum,i thought the..."

    By: johnyspencer at Oct 21, 2017 12:24AM

    Post: Claiming car expenses

  • "The above mrs monica fred is a scam and not even a good one"

    By: Jo at Oct 20, 2017 10:37AM

    Post: 101 Ways to Save Money on Your Tax Legally

  • "Do you need 100% Finance? I can service your financial need with less pay back problem that is why we fund you for just 2%. Whatever your circumstances, self employed, retired, have a poor credit..."

    By: Mrs. Monica Fred. at Oct 19, 2017 7:14PM

    Post: 101 Ways to Save Money on Your Tax Legally

  • "If i used a line of credit to purchase the shares, what documentation do I need to prove the loan was used for investments? Does it matter that I also have a home loan for a owner-occupied home? "

    By: Brad at Oct 18, 2017 9:02AM

    Post: Borrowing to buy shares

  • "Hello, Are you in need of loan ?? you can get your problems solved when you get here. I'm Mrs. Anna. From Australia, last week on Monday i was seeking loan to pay my bills, so I got into..."

    By: Mr Johnson Pablo at Oct 18, 2017 12:18AM

    Post: Claiming car expenses