Buying a house or apartment as a first time buyer
Everything you need to know about getting on the property ladder, from saving to mortgages to moving in.
Who is this guide for?
Sick of renting? Planning to move in with your partner? Just want to put your own paint on the walls?
There are many reasons to want to buy your own place, so if you feel like any of them resonate, this guide is for you - whether you're already looking at properties or plan to buy in a couple of years.
Even if you're not sure you can afford to buy, read on: there are several Government schemes to help you get on the ladder, as well as ways your parents can help you with the cost.
Buying can take months – even years – so let's get started.
Finding your new home
The first part of buying a home is undoubtedly the most fun. Call up your local real estate agents and have a look on Rightmove and Zoopla and get an idea of your budget, which largely depends on the mortgage you can get.
Can you afford to buy?
Don't be put off buying a home because you think you can't get a mortgage. There are mortgages out there to suit a wide range of incomes and deposits or even no deposit at all.
Plus see how your parents can help you get on the property ladder, without giving up their savings.
Saving up for a deposit
If you've not got enough for a deposit right now, all is not lost. Saving money is about so much more than being disciplined - there's a range of special accounts and approaches that can help you hit your goals quicker.
We run through the top options, whether you want to buy ASAP or in a few years.
Don't forget about these costs
Getting enough money to buy doesn't just mean the mortgage deposit. If only.
You'll need cash upfront for a whole range of services - from surveys to stamp duty - so it's vital you take these costs into consideration.
The Help to Buy scheme
Help to Buy greatly expands what properties you can afford. The government will loan you 20% of the money, or 40% in London, on properties up to £600,000. You will also still be eligible for a mortgage.
What's even better is you won't be asked to make any repayments for the first five years, giving homeowners a chance to settle in.
This scheme is definitely not for everyone, there are limitations on what properties are on offer and you a plan for paying interest repayments once they kick in.
Buying with siblings or friends
If you’re prepared to live with friends or siblings, a mortgage could save you both money on renting and it can set you up financially for when, or if, you do settle down.
You'll also be able to combine your deposit savings to get a far larger mortgage then you would by yourself.
There is no difference to a mortgage broker if you are buying as a couple or friends and you’ll be given the same choice of mortgages.
Shared ownership schemes
If you have enough of a deposit for a mortgage, yet it's not quite enough for a house in the region you were hoping for, a shared ownership scheme might be for you.
These little-known government schemes mean buyers can purchase 25-75% of the property and will have a lower mortgage.
The downside is you also have to pay rent to a local authority who owns the other portion and they take a percentage of the rent when you move out.
Rent to Buy and Right to Buy
These two government schemes help tenants of council housing or the housing association to purchase the property they are currently living in. They are greatly helpful for those struggling to save for a deposit while finding the money to pay their own rent.
In Rent to Buy, rent is offered for cheaper and the tenant is allowed to buy their house in stages. With Right to Buy the tenant is given a discount on the asking price of the property they live in.
Buying in Scotland, Wales and Northern Ireland
If you're buying your first home in Scotland, Wales or Northern Ireland, the process is a little bit different to in England.
Firstly, where Northern Ireland and England have Stamp Duty on properties, Scotland and Wales have Land & Building transaction tax.
Secondly, in Scotland, solicitors take the lead instead of estate agents. Also, make yourself informed about the different government help schemes available in Northern Ireland, Scotland and Wales.
Where to get a mortgage
Once you've decided you've saved enough money to get a mortgage, there can be a lot of confusion actually deciding which bankers, brokers and comparison sites are best.
Going to a bank at first may seem like the straightforward option, however, money can be saved if you are willing to talk to a mortgage broker.
From getting a mortgage to moving in
Got the money to buy your home? Congratulations!
Unfortunately, you're not quite done yet. Buying a home involves dealing with sellers, solicitors and irritating delays - including some problems that could send you back to square one.
Once you've moved in
The final days of buying a home can be fun but stressful: picking up the keys, packing furniture and persuading friends and family to help you move.
All worth it of course for that glorious moment of opening your own front door.
Just don't forget you're now saddled with a mortgage and bills, the costs of which can be terrifying.
Are you a first-time buyer, or just bought your first property? Is there anything we haven't explained, or do you have any tips to share? Please give us your feedback in the comments below.
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