2. A guide for first-time buyers

Buying a house is probably the single biggest investment you’ll make. Without a doubt, it’s a daunting prospect for first-time buyers. But it’s also exciting. You can start to think about what it’ll be like to walk through your own front door and create your own space. To make this dream a reality sooner rather than later, here are some top tips for starting your search:

Prioritise affordability. It can be tempting to look at properties you could buy if you won the lottery, but focus your time on what you can afford. Of course, there’s always some room for negotiating (generally not on new builds, though), but overly stretching yourself financially is a bad idea. Stick to a well-researched budget, and scope out areas you might have previously dismissed.

Secure a mortgage in principal. To know what you can afford to spend, you should get a mortgage offer from a bank or building society. The agreement in principal is a free document, and puts you in a better position when you start searching.

If you’re buying with someone else, make sure you agree on must-haves. It’s likely you’ll have to compromise when buying your first house – and yes, you should both be flexible. But knowing what you wouldn’t be willing to compromise on can speed up your property search. Within realistic expectations of your budget, decide early on if there’s anything you couldn’t live without, or a feature you’d be unhappy with. For instance, outside space or a second bathroom.

Know what to look out for. You can’t become a property expert overnight, but you can do your research to avoid unnecessary extra costs when you move in. Look for signs of damp, faulty guttering, weak toilet flushing and rotting window frames, as well as any missing roof tiles. You can ask the estate agent or owner when any renovations were completed, and how old the wiring, roof or boiler are. If the problems start to stack up, it could end up costing you a lot.

A. Expert advice on house hunting

When you first start house hunting, it’ll be fun and exciting. The novelty can soon wear off though. Struggling to find something you like for the right price can be frustrating. The problem is amplified by the number of properties you can view online. It can be tempting to dismiss houses after looking at just a few details and images on a screen – but nothing can compare to visiting the places you’re interested in. Of course, this takes time. To keep up the motivation and be a successful house hunter, consider the following top tips:

Identify your wants and needs. What you need from a house can be very different to what you want. Clearly separate the two, and know in advance what you’ll be willing to compromise on and what you can’t afford to live without.

Impress the estate agents. Estate agents are more likely to work hard for you if they like you. Get them on your side by being an impressive prospective buyer and submitting your requirements and mortgage arrangements in writing.

View properties on a weekday. Most people want to view houses at the weekend, but why not view several in one day during the week? Otherwise, you’re at risk of seeing properties few and far between. Taking too long can mean you miss out when you realise the first house you saw was your favourite.

Take your own photos and videos. It’s easy to forget the details of a property, or get confused between houses. To ensure you keep the details fresh in your mind, ask if you can take photos and videos. They’ll give a more realistic representation than those from the estate agents, and can jog your memory when comparing properties.

Focus on the things you can’t change. Decorations can change, so look past the colour on the walls. Depending on your budget, you’ll also be able to put in a new kitchen and bathroom. Instead of focusing on what superficial changes you would make, look at the factors that will be with you for life – the location, natural light, noise pollution and views.

Walk around the local area. When you find a house you’re interested in, be sure to check out the local area during both the day and night. Does the nearby pub get rowdy? Do neighbours leave the bins overflowing? Try and get a sense for whether the area is somewhere you’d like to live.

Find out about any local developments. Developments can be a good sign of up-and-coming areas, as developers look at things such as transport links, local facilities, schools, housing trends and council spending. If they’re investing somewhere, it generally means people are keen to live there. Alternatively, you might want to avoid any further development.

Compare similar properties. Think a home is overpriced? Check out the recent sales nearby. Not only do websites (such as Zoopla, Rightmove or Home Track) show you what’s for sale, you can use them to discover how much properties in the area have sold for in recent years.

Bring measurements on a second viewing. Do you really want to buy new furniture to fit the home? It’s good to know if you’ll have to replace your bed or sofas to fit inside. Bringing measurements means you can bear it in mind for budgeting.

Don’t be afraid of knocking walls down. In the UK, we still tend to refer to a property by how many bedrooms it has. Don’t feel limited by its current state. Walls can be knocked down. Think of the house in square metres and envisage its potential.

Be vigilant. This is a huge investment. Although it can sometimes feel like you’re under time constraints, take the time you need to be confident in your decision. Remember to check whether the property is freehold or leasehold. Leasehold properties with 90 years or less can cause problems when you try to extend the lease, sell or remortgage.

Make use of online tools. Just because you shouldn’t search solely online, it doesn’t mean you can’t use tools to your advantage. First of all, sign up to online alerts from key providers for the streets and postcodes you’re interested in. You can also consider using Property-Bee, a free add-on for Firefox. It shows sellers on Rightmove who’ve changed the price on their listing. If someone has reduced the price, it might mean there’s a lack of demand in the area and you could get your hands on a bargain.

B. Saving for a deposit

Saving for a deposit is the first – and sometimes hardest – step of buying a house. It’s recommended to have most of your deposit in place before you start house hunting. If you found your dream home, you’d only be able to progress with the steps of buying if you had the money ready.

Typically, a deposit will be 10% of the purchase price. As it can be difficult to save, there are schemes which help you buy with a lower deposit. The Help to Buy ISA is a well-advertised option, which boosts savings with 25% extra financial support from the government. You could get up to £3,000, but you can’t use the bonus for a deposit, contrary to what many people initially thought. In 2016, it was revealed that small print in the agreement blocks you from using the bonus when contracts are exchanged.

You can use the money you’ve saved in the ISA, as well as any interest on this, towards the deposit. But the government bonus is not applied until the completion stage, when the buyer takes formal possession of the property. At this point, your mortgage lender will send over the agreed purchase price, but you would have already had to pay your deposit – without the advantage of a government bonus.

Lifetime ISAs are another, more recent, option for savers. Designed to either help you buy your first home, or save for retirement, you can save up to £4,000 a year and get a 25% bonus on top. Anyone aged 18 to 39 can open a Lifetime ISA, but you can’t get a first-time buyers' bonus on both this and a Help to Buy ISA.

Financial life is tough for first-time buyers. When you’re saving, you might feel like you’re missing out. But saving requires commitment. To help you stay on track, here’s some advice and motivation:

Invite people over. Going out for dinner and drinks is an expense you can do without when you’re saving. But you don’t want to miss out on seeing family and friends. Instead, invite them over and get them to bring a bottle or some snacks. You can all socialise without too much of an impact on your wallet.

Practice cooking more. Similarly, get out the cookbook you got Christmas three years ago, and make meals from scratch. Buying ingredients will be cheaper than takeaways or dining out.

Cut back on other expenses. Have you got a gym membership? Are you buying lunch every day? When was the last time you looked at your internet, TV or phone package? Swap for the easily available cheaper options. YouTube is flooded with great exercise workouts you can do at home, you can double up portions to take for lunch the next day and cut out any add-ons you don’t need on key contracts.

Switch energy providers. Shopping around for better deals – or negotiating with your current provider – can save you money. Don’t be afraid to say you’ve found a better price elsewhere. Companies tend to take notice when they might be losing a customer.

Embrace the sharing economy. Think about how you could use what you already have to maximise your income. There are some innovative ways to increase cash flow. For instance, Nimber is a company which matches up people who need items delivered with ‘bringers’ who are already going that way. Your morning commute just got a bit more interesting.

Sell things you no longer need. Create an eBay account or visit a couple of boot fairs to get rid of the stuff you don’t use. As well as making a bit of cash, you’ll minimise clutter and have less stuff to move across when you buy.

Be savvy when you do buy. Of course, you could be saving for years and over this time, you’ll still have to spend money. Whether it’s a winter coat or your car needs new tyres, you can be vigilant when you spend. Use discount websites to hunt down bargains, and follow your favourite companies on social media to keep an eye out for deals.

Remind yourself why it’s so important. Saving involves sacrifice. It can be frustrating when you have to think about every purchase before you part with the cash. That’s why it helps to refocus your mind every now and again. Focus on what you’ll achieve in the long term by having somewhere to call your own.

Move home for the last few months. Moving back to your parents’ house might not work for everyone, but it can give your savings a final boost. You’ll also be in a great position to move, as you’re not tied up in a chain.

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