Buying a house for the first time is an easy decision to make. So many of us want to get onto the property ladder, and it can be challenging. There is certainly a lot to consider. One of those things should be, whether it’s the right choice for you. Have a look through this small guide for useful things to consider as a first-time buyer:
As with every big decision in life, buying a home comes with many advantages but also disadvantages which are essential to think about before making a move:
- You won’t be paying ‘dead’ money into rent- this is often something that renters worry about as they are paying the money out each month for something they’re not going to be getting back so as a homeowner you are investing in yourself.
- Make money- You have the opp[ortunity of increasing the value of your property over time and possibly making a profit if you were to re-sell.
- No longer having to have a landlord- We all know that they can be annoying.
- More secure payments- You have the option to keep your mortgage repayments at a fixed rate year after year; rent will often increase each year.
You have the responsibility- One of the most significant drawbacks is that you become responsible for paying for unexpected repairs and maintenance, no more landlord to deal with them.
Many people will already know this if you can’t keep up with your mortgage repayments your home is at risk and will be repossessed. So you need to be asking yourself if you can genuinely afford to buy a home. If the answer to the big home buying question is still a yes, then go for it! And start saving.
Save a deposit
There are obvious benefits to having a decent deposit when you are a first-time home buyer. It will make it much easier for you to get a mortgage at a reasonable rate. Another advantage is that you will have equity in your property right from the start. The bigger your deposit, the protection you are giving yourself if your property drops in value. Your property would have to experience a drop equivalent to the size of your entire deposit before you were in negative equity.
The best way to start saving is to write yourself a budget. Then you have to stick to that budget.
To help you do this, here are some things to consider:
- Could you reduce my food bills by eating more at home?
- Can you pay off any credit card debts?
- Can you reduce any monthly expenses such as gym membership or tv subscriptions?
As well as enabling you to save more money for your deposit, reducing your monthly outgoings will also boost your ability to being able to afford the mortgage when it comes to getting one. This is because lenders figure out what you can afford to borrow against your monthly salary minus your expenses.
Now It’s Time For The Mortgage
There is a vast range of available mortgages; they could come with a fixed or variable rate that applies over a specified period. It could be a good idea to arrange a meeting with an independent mortgage broker for some advice, although bear in mind some may charge for this service. You can also see what’s available by using comparison sites. You should be able to get a mortgage with a deposit of between 5% and 10%, but the cheapest deals will be reserved for those with the most significant deposits, so it’s best to save as much as possible. Try using some of the mortgage calculators available online to figure out how much you will be eligible for.
Time To Find Your Home
Once you know what mortgage you can get, it’s time to start. You can search hundreds of thousands of properties online. You can even set up a property alert to make sure you don’t miss out on new listings that meet your requirements. Also, you should register your interest with estate agents, and spend some time searching the property pages from newspapers. You need to have a good think about what you want your home to include such as a large garden, south facing, two bathrooms, three bedrooms, etc. there’s no point in looking at houses that don’t meet your requirements but bear in mind you sometimes need to make compromises.
Location, Location, Location
It’s essential to think about the location when buying a home. When it comes to where to buy your home, you should consider things like:
- How close is it to local schools, the hospital, etc.
- What’s the commuting distance to your work.
- Is there accessibility to public transport?
- How about the closeness to family and friends?
- What’s the crime rate?
- Proximity to pubs, restaurants, and entertainment?
Try making a list of your priorities as you’re not going to tick every box. It’s good to have a secondary list of compromises that you are willing to make.
Once You’ve Found The One
Once you’ve found a property that you want, it’s time to make a move and put in an offer. You should go off of the asking price but bear in mind you can sometimes offer a deal. It’s always a good idea to ask your estate agent if there is room for negotiation. First-time buyers are also favored as they have no upward chain meaning you’re able to move quickly.
Other expenses to keep in mind
The price of your home isn’t the only cost involved with buying it. There is a range of values. They can add an extra 15% onto the value of your new property so something you should consider.
You need to consider:
- Stamp Duty
- Furnishings- You’re bound to be excited to furnish your first home!
- Costs of moving-often lower as a first-time mover as they don’t tend to have as much
- Conveyancing solicitor
- Survey cost- cover yourself with having the building inspected.
There certainly is a lot to consider as a first-time buyer! Do you have any other hints and tips to help? Please share them in the comments section below.