5 Steps To Owning Your Dream Home

Owning a house is one of the indicators of financial independence. It is also one of the biggest financial commitment you will make in your life. Follow the five steps below to help you get you started on your Home Ownership journey:

1. Get your priorities straight

Many people make the mistake of gauging financial independence based on the ownership of material possessions such as branded lifestyle goods, the latest gadgets and luxury cars. As good as owning these 'assets' might make you feel at the time, they have a short shelf life and do not make great investments. Investing in assets such as property on the other hand would be better use of your money as the value tends to increase over time.

2. Go property hunting

Diligently visit websites, expos or property exhibitions to gather as much information as you can on the type of home you want, location, price and so on. Visit 'open houses' organised by property developers of housing complexes or satellite cities, read reviews from trusted sources on residential areas and keep up to date with the latest developments on urban planning.

3. Keep your financial capabilities in check

Owning or building your first house is an emotional process. As much as possible avoid making decisions when you are emotional to avoid going overbudget. Conduct regular financial check-ups by calculating your total income and expenditure every month and determine how much you can set aside for your savings or pay off the mortgage.

4. Know exactly how much you need to spend

Making your dream home a reality is not as simple as calculating the total cost of the house or apartment and the associated downpayments. It goes without saying that there are additional expenses outside of the cost of the house, such as taxes and legal and administrative fees that go along with building the house. Setting aside an additional 15-20% of the total cost of the house to cover these expenses is a safe bet.

5. Identify ways to finance your first home

A common way to do this is to take advantage of mortgage loans offered by banks or other financial institutions. Doing some prior research to find out more about how mortgage loans are structured, the difference between products on offer, terminologies used, requirements, penalties and other expenditures as well as calculating the associated interest rates and installments throughout the mortgage period goes a long way.

The journey to owning your dream home is long and arduous for most, and needs to be planned as early as possible. Perhaps you would like to make this dream come true in 2 years, maybe 5 - but you must start planning now!

Start gathering funds for downpayment on your first home by applying for the HSBC Advance Home Ownership Plan with only Rp 3.5 million a month to begin your journey and get home loans of up to 100 times your monthly savings as well as vouchers up to Rp1,9 million in here.

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