Sensible Housing advice from Judith Collins

The Herald has a story about MPs and how they bought their first home. Judith Collins gives some interesting and useful advice.

Paid about $60,000 for a two-bedroom flat in a block of four in Mt Eden in 1982 when she was 23.

She got the deposit together working as a lawyer and selling shoes at the weekend at Farmers.

She also got some money from her parents and a loan from her boyfriend – now her husband.

With interest rates around 20 per cent, it was “a huge struggle” to make payments.

She accepts it is difficult now, and says first-home buyers should be prepared “to buy a place that needs to be done up and to have a first home that may not be your last home”.

“I moved into a two-bedroom flat, I didn’t move into a five-bedroom mansion.

“What you have with your mum and dad is probably not what you’re going to get for your first home.” 

My first house was bought in 1987…I was 16. I had sold my shared and banked all the cheques just a few weeks before the stock market crash. I bought a shitty little two bedroom flat in Mt Eden, near Mt Eden Road…Dad went guarantor on my mortgage…I can’t remember how much I bought it for at the time, but I rented it out and the rent covered the mortgage. I had to manage it and rent it out…it was strange yet rewarding to be a 16 year old interviewing prospective tenants. Interest rates were well into double digits…and if i remember correctly I had to get the mortgage from our family solicitor because no bank would lend to a 16 year old. Subsequently after the 1990 election interest rates plummeted, making the property much more affordable.

I sold that flat when I moved to Wellington and got married, using the proceeds to buy a house in Khandallah. That house was certainly very modest compared to the house my parents lived in. We subsequently traded up and traded down according to our circumstances, moving to cheaper more affordable suburb when we started a family so we could live on one income…and subsequently traded back up later…

We did eventually lose our house as the result of the heartless actions of an insurance company…that matter is still before the courts. However the premise remains the same, buy where you can afford, improve the house, trade up when you can afford more, don’t over-extend and when times are tough be prepared to cash up and trade down in order to manage.

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