Tracy Hemingway

PHOTO: Encountering many hurdles including repaying debt, two years’ of saving and talking to seven mortgage brokers, Tracy Hemingway bought her first home for under $500,000 last December. Photo credit: Supplied.

After buying a house for under $500,000 with less than 20 percent deposit, a first home buyer says despite the tough market, there is hope.

It comes as banks toughen up on loan-to-value ratio (LVR) restrictions, requiring most first home buyers to stump up 20 percent deposit ahead of Reserve Bank plans to reinstate them from March. The REINZ national median house price reached $749,000 in December – up $121,000 (19.3 percent) year-on-year – accelerating faster than many Kiwis can save.

After repaying close to $100,000 of debt over three years and saving for a further two years, Tracy Hemingway has finally reached her homeownership dream. In December, she bought a three bedroom unit in Hamilton city, paying $490,000.

Despite the tough market, Hemingway urges first-home buyers to keep saving, put their best foot forward and to be prepared to compromise.