Tips for Getting on the Property Ladder
2024 is coming to a close and the world is preparing to get in the party spirit and welcome in the new year. It is a time for reflection but more importantly for setting goals and considering what we want to achieve this year, and where we see ourselves at the end of it. For many this will include facing the daunting, yet incredibly exciting, move of starting your journey as a first-time buyer and taking that initial step on to the property ladder.
When we use the term ‘first-time buyer’ we mean someone who is buying their first home and has never owned a residential property previous to this. Whether you are aiming to fly from the family nest or take the leap from renter to homeowner these top tips from property expert Natalie Mitchell at HomeHow.co.uk will surely help you as you start on your thrilling new adventure.
Start Saving
Before even factoring in any additional costs, the deposit for a first-time buyer in the UK can seem like a huge reach, but it can be achieved by being smart with your money and setting aside as much as you can to save for it. Setting yourself a monthly budget is the best way to approach this, and there are a number of online savings calculators which can help you to figure out how much you will need to be putting aside each month to achieve your goals for attaining your dream property.
Determine Your Budget
When considering buying a property it is important to determine both your short term and long term budgets. Getting settled in to the home of your dreams comes with a high initial cost and you want to be making sure that as well as paying your deposit you have accounted for the decorating and furniture you need to make the place feel like your own space. Beyond this, it is important to remember that this is a long term process and will come with many more costs further down the line. It can be easy to focus on the initial costs that come with buying an abode, but ultimately you need to be certain that you are going to be able to keep up with those mortgage repayments alongside your everyday costs such as food, water, gas and electricity.
Consider Additional Costs
As well as your monthly mortgage payments there are a number of other costs that you will need to factor in when buying a new property. These may include mortgage fees, solicitor fees, survey costs, 8insurance and tax. All of these factors are important to consider before you take that leap and purchase your new home and you are going to want to ensure that you have set enough aside to cover all extra costs whilst still keeping within your realistic monthly budget.
Explore Government Schemes
If saving for a deposit is something that feels like a struggle within your current budget, it may be worth checking out schemes that the government has in place to assist first-time buyers. Although the ‘Help to Buy’ scheme is no longer available to take out an ISA (Individual Savings Account) for in most parts of the UK you can still open a Lifetime ISA. This scheme is open to anyone who is over 18 and under 40 and allows you to put in up to £4000 a year until you are 50. The government will then add a 25% bonus to your savings up to a maximum of £1000 a year which can offer that boost you need until you are ready to withdraw the money to buy your first home.
Investigate Mortgage Products
Doing your research before meeting with a mortgage broker will enable them to have a better idea of what it is you are looking to get out of your mortgage deal and find the products that are best suited to you and what you can afford. Fixed rate, tracker and offset are all examples of the type of mortgage you can take out. Which one you choose will depend on your monthly budget and outgoings, how much you have been able to put away in to your savings account and the current mortgage rates in the UK - so it is important to decide how you can get the most out of your deal. It may be worth speaking to a mortgage advisor before making any firm decisions as they will be able to help you to weigh up the pros and cons of each type of mortgage and find the one that will be the most affordable for you.
Keep Track of Your Credit Rating
All first time buyers in the UK are subject to credit rating checks and affordability tests before you can be offered a mortgage so it is important to make sure that you have a good credit score by the time you wish to apply. Taking out a credit card and managing your repayments responsibly can be a great way of building up a credit history and showing that you will be able to keep up with your mortgage repayment costs. It is of vital importance, however, to ensure that you do keep on top of your repayments as missed and late repayments can stay on your credit report for up to 6 years. Getting on the electoral role is another useful way to speed up the process of lenders being able to check that you are who you say you are when looking in to your credit rating.
Choose Your Location Wisely
When starting your house hunt and looking at new properties one of the first things you will be thinking about is the area you want live in. Whether you are looking for somewhere close to your current home or aiming to start a new adventure in a new town or city, there are lots of things to consider when it comes to location. Local amenities, attractions, schools and job opportunities may all be factors that are of high importance to you but it is also vital to investigate the costs that come with living in a certain area. On top of the initial property prices, additional charges such as council tax rates, property premiums and commuting costs are all things you are going to want to consider.
Final Thoughts
Purchasing your first property is one of the most exciting and rewarding steps you can take in your life and by saving smart and staying aware of all that you need to consider when embarking on your journey you can ensure that it goes as smoothly as possible. I wish you all the best of luck for the new year and in achieving your goals to obtain the home of your dreams!
NATALIE MITCHELL: "Natalie Mitchell has worked as a property and construction expert for HomeHow for five years and has worked in the construction industry for over twenty years. Natalie continues to work on building projects while also providing expert construction and property advice to industry professionals and DIY enthusiasts."
