Buying property solo? Here’s how

If you’ve got the financial means, buying a property on your own will bring a huge sense of achievement.

While singles on an average wage are well and truly locked out of the Sydney property market for example, there are ways to get into the market alone without selling a kidney.

While there are challenges to overcome, Commonwealth Bank data reveals that a growing number of first home buyers are getting onto the property ladder alone, with 40% purchasing solo, rather than with a partner, friend or family member in the first six months of 2024.

The proportion of first home buyers using government-funded guarantees has also increased in recent years, the data shows. Between FY21 and FY24, first home buyers relying on personal guarantees increased by 45%.

Nationally, the average first home buyer home loan size was $497,692 in FY24. This rose to $529,642 in city areas compared to $403,203 for regional buyers.

While the average loan size for regionally based first time buyers was lower than city buyers, their average loan to value ratio was higher, the data reveals.

Flying solo

Whether it’s coupling up, living with parents longer than planned or tapping into the bank of mum and dad, buyers are seeking out increasingly innovative ways to break through affordability barriers these days.

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From moving into an apartment, living beyond the city fringe, saving longer, taking a part-time job to boost your income or seeking out a loan with an alternative lender, there are options available to first home buyers.

However, tread carefully. The Australian Bureau of Statistics considers that households are in housing stress if they spend more than 30% of their income on housing. But buying a unit or apartment is more affordable if you’re able to pull together a 20% deposit.

Property ownership is the single person’s tax. Having no one to split bills and costs with is undeniably difficult, says Melbourne buyers advocate Emily Wallace.

However, the process of securing a loan as a single buyer is the same. As long as you meet the lender eligibility requirements, your application will be viewed the same. 

The most important thing to remember when trying to get into the property market as a solo buyer is not to overestimate your accommodation needs, Ms Wallace says.

“Where solo buyers often fall short is when trying to buy the same sort of property that dual income households are buying, such as a two bedroom apartment when one bedroom would get them across the line,” she says.

While there are negative connotations around one bedroom apartments from a resale perspective, it’s important solo buyers don’t fall into the trap of trying to purchase beyond their means.

“Look at your needs based on where you are now,” she says.

“If you do meet a partner and your circumstances change down the track, you do have the option of moving in with your partner and making the one bedroom an investment property down the track."

Consider your options

While she notes some stigma on social media, the fact is that a lot of singles in the first home market are securing their first property with some financial assistance from the bank of mum and dad.

Using 'the bank of mum and dad' can sometimes come with an unfair taboo. Picture: Getty

“While that does come from a place of privilege, it shouldn’t be as taboo as it is," Ms Wallace says. "There is generational wealth being handed down to the next generation right now as part of the wealth transfer, and if it’s the difference between getting into the market or not, then that’s going to be the right decision for them to take that help."

Wallace has worked with buyers who have purchased with a sibling who doesn’t live in the property happy to co-purchase as an investment for them.

Early inheritances from living parents are also becoming more common to help singles into the property market.

Be aware of what your financial options are is important. Private equity schemes and government support options exist for first home buyers.

Your profession can also except you from certain deposit thresholds, such as accountants, nurses and teachers could see Lenders' Mortgage Insurance waived, she says.

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“The sooner you can get into the market, the better, rather than trying to out-save the market,” Ms Wallace says.

Tips for solo first home buyers

If you're ready to make your move, here are several tips to consider.

Pay off your debt

This is the time to get serious about cutting up the credit cards, demonstrate regular savings and reducing unnecessary spending. Also make sure you have a stable job that provides reliable income.

This one-bedroom apartment in Fortitude Valley in Brisbane's inner city suburbs is on the market for $485,000. Picture: realestate.com.au

Adjust your dream

Buying a one bedroom unit, rather than an entire house, might be more realistic. Also consider buying in a city fringe or regional area, where unit prices are likely to be lower.

This one-bedroom apartment in Dee Why on Sydney's northern beaches is on the market for $690,000. Picture: realestate.com.au

Explore low deposit options

Find out if you’re eligible for a low deposit loan, which often come with incentives and government support.

This two-bedroom apartment in Coombs in Canberra's south west is currently on the market for $489,000.

Set a budget

Achievable savings goals to carefully track your saving over the course of a year is important. Consider downloading one of the countless savings apps on the market to track your spending.

This two-bedroom apartment in Essendon North in Melbourne's north is on the market with a price guide of $380,000-$405,000. Picture: realestate.com.au

Bolster your income

While asking for a pay rise is one option, there are other ways to boost your financial capacity. Side hustles, diversifying your income, selling unwanted items or rentvesting are worth exploring.

This one-bedroom apartment in St Mary's in Adelaide's south is on the market with a price guide of $300,000-$330,000. Picture: realestate.com.au

Tax breaks and government incentives

Depending on the state you live in, you may be eligible for a government scheme or tax break. The First Home Guarantee allows eligible buyers to purchase a property with as little as a five per cent deposit without the need to take out Lender’s Mortgage Insurance.

This two-bedroom apartment in Ellenbrook in Perth's north east is on the market for $459,000. Picture: realestate.com.au

Be upfront with family

Letting your family know your purchasing intentions could yield some interesting conversations about co-purchasing with a sibling, a low or no-interest loan from a loved one or perhaps an early inheritance.

This one-bedroom apartment in Darwin City in central Darwin is on the market for $299,000. Picture: realestate.com.au

Consider alternative lenders

There are so many lenders on the market these days, so shop around to understand the variations in packages that can make your home loan more affordable.

This two-bedroom apartment in Varsity Lakes in the Gold Coast's south is on the market for $675,000. Picture: realestate.com.au

Find a mortgage broker

You don’t have to wait until you’re ready to purchase to track down a mortgage broker. Early conversations are useful because a mortgage broker can help you understanding your borrowing power and which support schemes might be available to you.