10 Valuable Lessons for First-Time Home Buyers
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Buying your first house is exciting, daunting and also full of valuable lessons. The more you can prepare yourself for the common pitfalls that... The post 10 Valuable Lessons for First-Time Home Buyers appeared first on My Green Home Blog .
Buying your first house is exciting, daunting and also full of valuable lessons. The more you can prepare yourself for the common pitfalls that may affect new buyers, the more likely you’ll be to avoid them.
Saving up is your first port of call. Saving for a house deposit takes time, energy and a planned approach. Create a budget to work out how much you can afford to put away, look at Help to Save schemes and the new buyer’s ISA products, and research banks for those which offer special rates for deposit savers.
Be realistic with your timelines and track progress so that you can see how close you are to your goal. If your budget and savings calculations show that you’re likely to be saving for years until you have sufficient deposit, put your plan B into action. Look at less expensive areas, consider shared ownership schemes and look for new build schemes which may allow smaller deposits of around 5 per cent.
Be flexible if you are committed to getting on the housing ladder. There are also guarantor mortgages available if your parents are willing to financially back you as a lender; all worth looking at in your quest for home ownership. It also makes sense to have a healthy contingency fund available, as the costs mount up.
On mortgages, homebuyers reports and insurance
There is enormous variety in the mortgage world and interest rates are currently very low compared to historical averages. It is often worth using a whole of market broker who will have access to mortgage deals that you might not be able to find easily as a ‘regular’ customer.
It is also tempting to get the basic home condition report to save money, but remember that a house purchase will be one of the biggest you’ll ever make in your lifetime. So consider getting the more comprehensive homebuyer’s report and spending the extra. It will tell you far more and will give you some negotiating power with the sellers if something crops up that potentially diminishes the home’s value.
Remember too to shop around for your home insurance and don’t feel that you must take buildings insurance from your mortgage provider. They may try the heavy sell, but you aren’t obliged to take it from them, only to have it in place for the duration of the mortgage.
Making a decision
It’s easy to get swept away by a house that you really love, without objectively assessing which features would need to be changed to fit your needs, and which of those would be simple or difficult to manage; both in terms of ease and cost.
For example, instead of completely upgrading the kitchen / bathroom, you could simply install a mains booster pump and that will dramatically improve the water pressure in the whole property.
If you have thoughts of knocking through a partition wall but haven’t actually checked whether or not it is structural, you could find yourself in a fix. Equally, don’t make a choice on your preferred home without enlisting help from at least one other person for a second point of view.
A parent, friend, partner or sibling can be useful since they will see different things from you and will be less emotionally invested in the immediate response to the place. Take a checklist with you that refers to your must haves and ‘would like to haves.’ Take photos, make notes and capture specifics. You’ll be amazed at how you remember things differently later on.
If you’ve visited a potential dream home on a sunny day at the weekend, make sure that you visit at rush hour, and in the evening. Houses, roads, conditions and even neighbours can have very different patterns at different times of day and you don’t want to be lulled into a false sense of security by visiting at the best time of day for that property. For example, homes near schools can find that roads become very congested at drop off and collection times.
Don’t rush into buying your first home if you don’t yet have an emergency fund saved up, certainty of employment and a clear plan for maintaining the house, making repairs and covering the mortgage. It is well worth taking your time until you are sure of your position. As we touched on earlier, a home purchase is likely to be the biggest you’ll ever make, and it’s an asset that you will have for some years once you do invest; for better or worse!