“Stop buying avocado toast if you want to buy a home”

As originally posted by the National Housing Trust on December 16th, 2020.

The most controversial statement of 2017? Maybe not. Controversial enough to infuriate millennials globally…definitely. Australian developer and 35 year-old multimillionaire Tim Gurner sent tongues wagging when he quipped that millennial homeownership goals were being thwarted due to their penchant for store bought ‘pear and bread’. Persons were not having it, why?

It discredits the effort of so many millennials making sacrifices to break into the housing market while still trying to balance everyday expenses and debt repayment.

The statement also reminded us that there is a pervasive narrative that millennials, when compared to previous generations are frivolous with their spending habits.

The truth is, most millennials are desirous of taking the plunge into real estate. As a matter of fact, thanks to millennials there is a seismic shift within the housing market. According to global trends, millennials represent the largest share of the home buying market for the past five years.

Millennials may be showing up later to the game than their parents, but the fact is they are showing up and continue to do so.

The National Housing Trust, NHT continues to partner with thousands of millennials to finance places and spaces to call their very own. With several loan financing options available, there is something for everyone and quite a few millennials are turning to the NHT’s Joint Finance Mortgage Programme, JFMP. The JFMP was established in 2003 and allows contributors to acquire additional funding. In other words, the contributor will get their NHT entitled amount at the applicable NHT interest rates. This amount will be combined with whatever additional amounts that the contributor borrows from a participating institution at their interest rate. Repayment is made to the participating institution.

The NHT sat with one such millennial homeowner and environmentalist Giselle Hall (G.H) to share her homeownership journey.

NHT : Congratulations, you purchased a house! It is such a significant step, especially as a young adult. When did you decide to purchase and what motivated your decision?

G.H: It may be hard to believe but I knew that I wanted to purchase a home as early as my teenage years. While most teenagers were consumed with the next big thing, I was familiarising myself with the housing market and what the possibilities were. I spent much of my free time browsing real estate websites. As I matured I realised that purchasing a house earlier would mean cheaper monthly repayments.

Many people may not even realise but a house is possibly one of the few, if not the only investment that appreciates in value over time. Therefore for me, owning a home represented more than just a space to reside but an opportunity to build generational wealth.

NHT : How long did it take for you to save for your home?

G.H: It took me approximately six years. I was blessed to secure a job after I graduated from university. Once I earned my first salary I started saving. Even when I was promoted and began earning a bit more I tried to keep my expenses the same.

NHT: You must have the budgeting skills of a whiz kid. How did you manage to save so much and still survive?

G.H: Life is about balance however saving for a home requires sacrifice. At a very young age it was instilled in me that “if yuh want good, yuh nose haffi run”. When I have a goal, I remain very focused. Instead of spending at the salon I learned to do my hair and nails. I carried lunch to work almost every day. Whenever I did go out I ensured to stick to my budget.

NHT : What were some of the steps you took or would advise someone to take before commencing the search process?

G.H:

• Get your pre-approval letter from the NHT.
• Establish how much you can afford- It is so important to have an idea of what you want and what can afford. If your priority is privacy and yard space, then an apartment may not be for you. With regards to what you can afford, know your budget and stick to it. I had created a payment schedule in excel to work out what my monthly payments would be like if I bought a house at varying prices and how long it would take me to repay. This gave me an idea of my monthly mortgage payments. Additionally, many financial institutions like the NHT have mortgage calculators on their website which makes the calculation process easier.
• Have an open mind- So many people enter the search with a rigid idea of what they would like and sometimes that’s not what you will be able to afford. My experience taught me that no house will tick all the boxes. So the rooms may be great but the bathroom fixtures require updating or the living room is a little small but the kitchen is great. Unless you are building a home to your own specifications, no house will be perfect. It is important that young professionals realise that there is nothing wrong with a fixer upper. They are cheaper and you can make the changes to the property over time. Homeownership is never a sprint, it is a continuous journey.

NHT: That two-year search is the truth! It’s great that you only needed six months. So after you found the house, you financed it using the NHT’s Joint Mortgage Programme. What was that aspect of the process like?

G.H: Let’s just say I am an even prouder NHT contributor having benefitted from the Programme. I was able to supplement my NHT loan with a loan from another financial institution. The NHT’s portion coupled with their low interest rates made my monthly payments feasible. If I had burrowed the entire sum from the other financial institution, the monthly payments would have been unbearable.

The financial institution was able to process both their portion and the NHT’s sum in house, talk about efficiency! There is so much “up and down” involved in the purchasing process, one less place to visit is time saved. Additionally, I like the fact that my mortgage is just one monthly payment.

This is why contributing is important. You may see this money being deducted from your salary and wonder if it is even necessary. The truth is, it is very important. You never know what the future holds where your contributions are concerned. Your contributions are also like a savings tool, if you don’t access your benefit, the refunds are available. You can also transfer your benefits to assist your children, so you really can’t lose.

G.H: I was ecstatic.

After years of hard work my dream had finally been realised. When I finally opened the doors, I ran through the house, up and down the stairs and I screamed. It is one of the best feelings ever, to know that you are the owner of real estate. It’s mine and I can do whatever I want. I never have to be concerned about a landlord placing me in an uncomfortable position or giving me notice. You are just required to maintain our mortgage payments. When you own a home you walk different, talk different and you feel different about yourself and the world. Sometimes we delay a goal because we believe that it may take too long to achieve but the time will pass anyway so just start, with what you have and where you are.

Giselle’s story is one of the thousands of stories about millennial homeownership right here in Jamaica. The NHT recognises your sacrifices and hard work and we believe that every Jamaican, young or old deserves the opportunity to create their very own space to call home. Who knows, our next feature could be you!

So let’s JOIN you on this journey because this isn’t just about turning a key, it’s about building a legacy.

Click to find out more about the NHT’s Joint Finance Mortgage Programme.

NHT: So after the process was completed, and the paper work approved, can you describe the moment when you finally got your keys?