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A Concise Guide To Buying A First Home

Posted 16 April 2021 by Keith Osborne

A few of the essential steps to take to ensure a smooth journey in taking a first step on the property ladder...

Buying your first home is one of the most exciting and biggest decisions you will make in your life. It’s a complex and lengthy process that can feel extremely daunting even to those who have done it before.

Though it may seem completely impossible to get on the property ladder – especially with the cost of house prices continually rising – it can be very achievable with the help of our guide.

Location, Location, Location

Location is by far the biggest influence on the cost of a house. On a broad scale, some parts of the country are simply vastly more expensive than others. If you’re willing and able to move, then consider cheaper areas of the country such as Wales or the North of England. A recent study found that Burnley in the North West of England was the most affordable town for new buyers.

Even if you’ve decided to live in an expensive area, such as London or the South East, then it’s important to research the specific details of that location. Nearby public transport and amenities will influence the price considerably – and can mean cheaper houses if these elements aren’t as important to you.

Another way of reducing the costs is Shared Ownership.

Many housing associations and private developers are offering schemes to allow you to buy a portion of a property and pay rent on the remainder. Make sure to research this option, or speak to an independent financial advisor, before buying – as these arrangements will usually require a monthly service charge and contributions to maintenance works.

Help to buy ISA – building a deposit and deciding your budget

It may surprise you, but deciding your budget for purchasing a house is without a doubt one of the biggest decisions you will make on this journey. Your budget may seem like a static number - you can only spend the money you have - but it doesn’t have to be.

Buying your first home will mean saving a deposit. Due to the recent announcement of the mortgage guarantee scheme from the government, you can buy with deposits as low as 5% on properties under £600,000. Similarly, putting money into a Help to Buy ISA can offer a big boost in your deposit – with the government adding an extra 25% of your balance to any first-time purchase of a house.

These schemes mean that you have both a greater flexibility on how much you want to spend on a first home and what that money can get you.

But don’t think that you have to go entirely alone on creating your deposit. Your family can be a huge asset in buying a home. Though extra financial help is the obvious potential benefit, there are other ways they can support you.

Family offset mortgages, where a family member links the deposit to their savings account, can reduce the interest charged on that mortgage. Similarly, a guarantor mortgage, in which a family member agrees to meet repayments if you are unable to, can also be a method to secure your first property.

Check your credit score

One of the best ways you can prepare as a first-time buyer is to improve your credit score in advance. Having a strong credit score can not only affect whether your mortgage application will be successful but it can also affect your monthly repayments as well.

Applying for a credit card is a great way to build up credit rating. Even a few months of repaying the balance in full will see noticeable improvements to your score.

In the same vein, reducing any unsecured or outstanding credit you have is vital before applying for a mortgage, as you may be unsuccessful in securing a mortgage agreement if you have substantial debts.

Research the added costs of buying and owning a home

At first glance, saving up for a deposit may seem like the only thing you need to do before getting on the property ladder. Unfortunately, this can be just the tip of the iceberg when it comes to the costs of buying your first home and they will all need to be factored into your decision.

Broadly, here are the major extra costs you’ll need to be aware of: mortgage fees, valuation fees, survey costs, conveyancing fees, removal costs, and solicitor fees.

Ensure that you do further research into these additional costs, as they can quickly add up throughout the lengthy process of purchasing your first home.


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A Guide To Part Buy Part Rent
With Home Reach you buy a share of your chosen newly built home and pay a monthly rent on the part you don’t buy. Your budget will decide the size of the share you buy, rather than the size of your home. So, you might decide to buy a bigger share of a lower priced home or a smaller share of a more expensive home.

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