Thinking about some best way to start saving for a home? These article will cover some tips to start saving to buy the home of your dreams.

Below are 3 Tips to start saving for a home:

Boost your Savings

Money bloggerKrysta  l Yeesaved for a home down payment in Vancouver, where home prices are high. She boosted her savings with multiple streams of income:

"I went about creating multiple streams of income, and did everything I could to make extra money. I've had two full-time jobs at the same time (a 3-month time frame). Took on graphic design contracts. Started freelance writing. Sold stuff on eBay. Worked for $8-10/hour at a part-time job for years. YEARS. The list goes on. Sometimes you have to do un-glamorous work in the short-term in order to achieve a big goal."

Also, consider areas of your budget that can be reduced. Rent is a big one. Consider a cheaper apartment. Maybe find a roommate. Source: Twocents.lifehacker

Cut out Expenses

Can you cut the cord on cable, get a cheaper cellphone plan, use the road for workouts rather than the treadmill at the high-priced gym? Nobody wants to say it out loud, but most people have plenty of places to skimp on or eliminate expenses. It won’t be convenient and you may miss not having them, but it’s necessary if you're serious about saving. Source: Investopedia

Check your Loan to Value Ratio

When thinking about how much to save, check your loan to value ratio (LVR). This is calculated by dividing the amount of your home loan by the purchase price (or appraised value) of the property.

Lenders use your LVR to gauge how risky it would be to give you a loan. 

In general, the higher your LVR, the higher the risk the lender will not be repaid if you default on the loan and they have to sell the property. Having a high LVR may also affect your ability to refinance your loan later on, and you may have to pay mortgage insurance again if the LVR on the new loan is high.

Usually lender's mortgage insurance (LMI) is payable if your LVR is above 80%. This is a one-off insurance premium to protect the lender should you default on your home loan.                       Source: MoneySmart


Rob Palm - Whistler Real Estate Company

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