What to consider before buying your first property
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The help available - and pitfalls to avoid - for first-time buyers
Autumn is traditionally a time of year when the property market starts to get going again after the summer holiday lull - and for many house hunters this will be their first ever step onto the property ladder.
Here are 10 tips for would-be first-time buyers to make the process a little less daunting:
1. Save hard
Work out how much spare cash you’ve got left over each month and consider setting up payments to go straight from your current account into a savings account, to avoid the temptation to spend the cash.
2. Look at ways to boost your savings
First-time buyers can also turbo-boost their savings with, for example, a Help to Buy Isa or a Lifetime Isa, which come with bonuses. Generally speaking, the bigger the deposit you have to put down, the more choice of mortgage deals you’ll have, which could really help when it comes to making repayments.
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3. Show you’re responsible
Building up a good credit history and showing you’re responsible with money will be important when it comes to taking out a mortgage deal, so if you’re not diligent already when it comes to paying back debt, such as credit cards, make sure you change your ways now.
4. Factor in all the costs
You may have thought about the deposit, but what about all the other costs, such as removal firms, estate agent and surveyor fees, conveyancing costs and taxes? Recent research suggests home buyers underestimate their moving costs by nearly £2,000 typically. On top of this, there’s also the cost of furniture to kit out your new home - which is where charity shops could come in handy for a bit of cut-price retro chic.
5. Put some spare cash aside
Rather than spending every last penny, try to keep some money aside to start a “rainy day” fund. This will help if you suddenly have a big bill to pay - such as if the boiler breaks down - rather than having to resort to putting the cost on credit.
6. Choose your mortgage wisely
Navigating the mortgage maze can seem quite daunting if you’ve never done it before - but the good news is, there are still plenty of low rate deals available. When choosing a mortgage, it’s important to bear in mind the overall cost of the deal, not just the interest rate. While a particularly low rate may grab your attention, bear in mind any fees and charges that also come with the deal.
7. Target your area
Make the most of property websites to get an idea of what prices are like in your desired area, to give you an idea if what you are looking for is realistic on your budget. You may also want to target nearby up-and-coming areas, where there could be more wriggle room for the property you’re buying to increase its value over the coming years. This could help to boost your equity position when you’re ready to take your second step on the property ladder.
8. Get to know your local estate agents
Even if you aren’t quite ready to buy yet, it could be worth chatting to estate agents in the area to find out what’s available. A good relationship with your local estate agent could also help to keep you informed if your ideal home comes up.
9. Be confident about haggling
If you’re going down the haggling route, do some research first to help bolster your case and make sure what you’re asking is reasonable. Politeness when haggling could also help. But be prepared and have a back-up plan if the answer is no.
10. Be prepared to compromise
Whether it’s the location, the size of the property, or your new home being more of a “doer-upper” than you’d originally planned, a willingness to compromise could make all the difference when it comes to buying your first home. Even if your first home isn’t your dream home, at least it could be a step towards it.