On the ladder: 'Flatties mean three-plus incomes service the mortgage'
Buying your first home has never been tougher. In this series, stuff talks to Kiwis who've made it onto the property ladder and others who, by choice or not, are still renting.
Living with flatmates was all Rowan and Jarred Scott knew when they started saving for their first home.
In fact, they were so used to a house full of people, they moved two of their flatmates to their new house, acquired a couple more, and even kept them on after their first child was born.
"Our rental house, which was really dated, had four bedrooms and there were always about six people living there," says Rowan Scott, 34. "It was the best way for us to save, and Jarred has proved to be a really, really good saver."
But her husband, Jarred, 30, a newly graduated lawyer who went back to uni to get his Masters, was also on the back foot. He lost money in the Nathan Finance business collapse, which saw him get 2 cents back in the dollar. "Jarred lost up to $8000, which was a decent amount for us," says Scott. "Fortunately, I had only got around to filling in the prospectus and hadn't actually sent it in, so I was lucky not to lose money also."
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This couple also worked long hours to help save the deposit for their first house and to contribute funds towards their wedding. "We were both working for the IRD and took overtime whenever it was offered," says Rowan Scott. "And I also took second jobs working in bars and cafes. We didn't spend money drinking. As we were both involved in karate, teaching kids, we got to train for free, so that was another big saving. That's what we did up to five days a week, rather than go out drinking or eating."
The pair also took the "worst house in the street" approach, buying a first home in Auckland's Browns Bay that no-one else seemed to want to live in. And although the site was large, it was not quite large enough to subdivide, so the developers didn't want it either.
Are you on the first rung of the property ladder? How did you do it, or maybe you’ve tried and failed. Send your story, video and photos to newstips email@example.com
Scott says the five-bedroom house they bought in 2012 for $630,000, was in a "terrible state. "The grass was very overgrown and there were creepers, ivy and agapanthus everywhere – you couldn't even touch the fence. The people living in the house would throw their rubbish into the garden, rather than throw it out.
"But we figured, we wouldn't have to worry about our flatmates destroying the house – it was already run-down."
Flatting in their first home with four others must have been a compromise, but Rowan Scott says they had always been flatting with other people, and were used to it. "It was better that they were paying us, rather than someone else. It was like having three-plus incomes servicing the mortgage."
The couple did put in a second toilet and cleared up the grounds to make the property more habitable. And they kept on their flatmates, even after they had their first baby.
"We were essentially living with the baby on one floor, and the flatmates were on the other floor. We shared a kitchen, three toilets and two bathrooms."
Two years ago, the couple moved to Whangarei and bought a second, three-bedroom house on 1ha just north of the city, for $340,000. Jarred Scott works as a lawyer and Rowan Scott works in insurance. And they still share their house. "We have an au pair to help with Amelie, 3 and Dahlia, 1," says Rowan Scott. "That worked out to be cheaper than daycare options."
The Scotts still own the Browns Bay house, with a former flatmate taking over the lease.