Buying your first home sounds cool but what are the financing options that are open to you when you are buying a house for the first time? Saving money is one way to go about it but there are other options you can explore. Let’s take a look at some of them and how you can make them work for you.
Saving Money For Your First Home
You don’t have to save up the entire money you need to buy your first home all at once. You can do it in bits. It makes it easier to achieve your saving goals for the home.
It’s important that you keep it realistic. Don’t set saving targets that you will not be able to achieve. If you’re going to be saving to buy your first home, consider starting early. For instance, if you’re going to buy a house worth N10 when you are 45 years old, you have to be able to save a minimum of N500,000 every year starting from when you are 25.
When saving money for your first home, there are strategies that can make this easier. Some important questions you should ask yourself as you plan for this include:
- How much do you need to save?
- What percentage of your salary do you need to save?
- How can you keep track of your expenses?
- How can you create a budget and monitor it?
- What are the things you need to sacrifice to enable you to save more?
- The idea here is to understand how to save more of your salary.
Inheritance
You can inherit enough money from a loved one to buy a house and this is very popular here in Nigeria. We have parents who leave their children with a fortune but set it up in such a way that the beneficiaries cannot access the inheritance until they attain a certain age. This is one way to fund the cost of your first home especially if you have rich parents.
Housing Schemes
Housing schemes are quite popular in Nigeria and there have been several examples of this in the past. These schemes are facilitated by either the government or private investors who give you the luxury of paying an initial deposit and spreading the rest of the cost of the house over a mutually agreed period of time.
Examples of housing schemes in Nigeria include:
- The National Housing Fund
- The Federal Integrated Staff Housing Scheme, also known as FISH
- My Own Home – an offshoot of the Nigeria Housing Finance Programme (NHFP) set up by the Federal Government
- The Nigerian Housing Finance Programme
- Lagos H.O.M.S
These schemes target low-income earners as more and more developers in Nigeria align with housing schemes powered by the Federal Government of Nigeria.
In recent years, the Federal Government has entered into strategic partnerships with private estate developers on housing schemes that more low-income earners can benefit from.
It is important to highlight the fact that most housing schemes in Nigeria are public-private partnerships that seek to increase access to housing finance in Nigeria through mortgages, mortgage guarantee/insurance and housing microfinance.
House Loans and Mortgage Plans
Quite a number of people cringe at the thought of taking property loans. We should mention here that loans may not be as bad as you think especially when you take out a loan you can afford to repay.
If you are a civil servant, one way to benefit from this would be through government packages for home acquisition for its workers. Mortgaging also works perfectly as a reliable financing option for your first home.
Final Thoughts
Finance is a very crucial part of the real estate market and raising money for your first home is no exception. Take advantage of the opportunities we have highlighted for financing your first home.
Remember that owning a home in Nigeria gives you the bragging rights to opt out of the circle of Nigerians who live in rented apartments. You would, however, agree that a house is not the cheapest thing to buy. Your first step towards financing your home should be developing the ability to plan ahead for them and tap into opportunities when you stumble on them.
