Be prepared as you take your first step on the property ladder
Buying a home at any time is potentially stressful but doing it for the first time can be even more fraught. There’s much to consider and various steps to take – and it’s vital to keep a cool head during what is also an emotive process.
Key points to be aware of:
Establish accurately what purchase price you can afford
There’s really no point in spending hours on property websites or generally searching until you know exactly what you can afford.
This can only be established with a firm mortgage offer (assuming you will be funding your purchase this way), and a ruthlessly honest self-appraisal of whether you can afford it and the other associated costs of home purchase and ownership.
Talk to one or two lenders or a mortgage broker to find out what’s possible. They’ll assess your financial position in terms of income, outgoings and credit history and what you must put down as a deposit – these days 5% of the price of the property is a minimum but higher could help secure more advantageous mortgage terms.
While your potential lender will likely do this, ensure you have some idea as to what interest rate rises may mean in terms of an increased mortgage payment each month.
Ensure you know what other costs you’ll incur in buying a property such as solicitor’s fees, stamp duty (if applicable), removal costs and more.
Then consider your monthly commitments in terms of bills other than the mortgage payment such as council tax, utilities and so forth. Bear in mind these are likely to increase so be careful if your costings show you’ll be ‘up to the limit’.
This is an area many first time buyers overlook after the euphoria of securing a mortgage offer.
You’ll need experts to help you find and buy your desired property.
Estate agents – find experts in the area you’re looking to buy in such as Keystones Property Estate Agents if, for example, you’re looking in the Romford district and South Essex areas.
If you approach them once you have a mortgage offer, they can more readily help you in ensuring you’re notified quickly regarding properties in your price range.
Solicitors – find one who comes recommended unless you already have people, you’re comfortable with.
Mortgage broker – again, use a professional you can trust who comes recommended if possible.
While for many first-time buyers’ finances are squeezed in what is an expensive time, try and leave some money in reserve for an unexpected expense whether in the sort or longer term.
You may consider paying more as a deposit to lower mortgage repayments but think carefully if this would leave you with no financial buffer.
You may have to buy something for your new home you’d forgotten to add to your list, or – if you’re unlucky – something may need replacing soon after you move in. For example, if an older property maybe the boiler stops working or it could be something unrelated such as an unexpected expense on the car.
Be aware of other buying options
Maybe your costings show you can’t afford what you thought, but there are government supported home buying schemes that may make the difference and bring property ownership within your budget so they’re worth looking into.
House hunt methodically
Once you have funding organised in principle, it’s easy for the emotional side to hold sway as you look for properties but it’s important to keep in mind your requirements.
Location – confine your search to the locations you’ve decided upon. Beware of being tempted away from them; for example, that delightful chocolate box cottage may be affordable but if it’s too far outside your ideal location it may prove impractical for travelling to work, local amenities and so on.
Property requirements – list your key needs and ensure properties meet them; use these as keywords (for example ‘off road parking’) in online searches along with obvious requirements such as number of bedrooms.
Work with your estate agent – along with showing them you’re a serious buyer with a mortgage offer as mentioned earlier, explain precisely what type of property you’re looking for and where. They can help you more easily knowing your exact needs.
Viewings – this is where the subjective and emotive aspects can really dominate so try and be as practically minded as possible when viewing properties.
Check the condition of the property as far as you can; maybe take your own photos on your phone and assess the rest of the neighborhood. Try and visit the area at different times of the day.
As a first-time buyer with a mortgage offer, you’re in a good position as you have nothing to sell so are, in property parlance, ‘unencumbered’ so the purchase should be a smooth one.
Therefore, make the most of this position by trying to negotiate on price. Again, beware of the emotive aspect – if it’s the property you really want you might balk at negotiating or be prepared to cede more ground for fear of losing out.
Stay level headed throughout.
Keeping emotions at bay
There have been various references to the emotive side of property buying, but it’s important to reiterate the need to try and keep them in check to end up with the best property for your needs at a price you can afford.
What to be aware of as a first time buyer especially budgeting carefully to include all aspects of buying and paying for a property; house hunting and negotiating.