If there is one buzzword that we have constantly heard in the housing industry over the last few years it is “first-time buyer”. With house prices rocketing to record levels, and bumping up the cost of putting a deposit together, the media have let us all know in no uncertain terms that it’s harder than ever before for someone to get onto the housing ladder.
Unfortunately, this is completely the case. Young people don’t tend to have the tens of thousands generally needed to put together a deposit – and this creates the problem.
Today’s article will now look at some tips that you can implement to perhaps make the process a little more efficient, and make you become that elusive first-time buyer quicker than you first imagined.
Tip #1 – Be prepared to move in with relatives
It might sound daunting, particularly if you are part of a couple, but moving in with relatives can be one of the easiest ways yet to bump up your deposit. Sure, on the most part you will have to pay to live there, but this is likely to come at a significantly lower cost than renting privately for months.
How long should you do this for? It depends how much you need to save. You will also need to take into account the costs of storing your existing furniture with a company like Safestore, as on most occasions you won’t be able to move your whole house into your family’s place!
Tip #2 – Tap into all of the incentives
First-time buyers might be up against it, but at the same time they have access to some powerful incentives.
Realising that there is a clear problem in getting young people onto the housing ladder, the authorities have created all sorts of incentives such as special bank accounts (which can top up your deposit by as much as 25%) right the way to the removal of stamp duty.
Research all of these incentives as it might make your plight a little easier than you first imagined.
Tip #3 – Think outside the box with mortgages
In some ways, this links to the previous point. After all, one governmental incentive is the 5% deposit – which clearly makes a monumental difference in your battle to buy during the early days.
It’s not just about that, though. There are also guarantor mortgages if your situation allows, which will provide you with more favourable terms if you ask someone like a family member to guarantee that you will pay the mortgage. It’s a big commitment, but more and more people are going this way.
Tip #4 – Compromise is key
We will end with something that won’t be easy to hear, but on a lot of occasions first-time buyers are forced to compromise. Once you start to total all of the fees, as well as the obvious asking price, things are usually more expensive than you first thought.
It means that you might have to compromise on one less bedroom, or the area that you are targeting. If you can at least accept this early on in your buying journey, it will make for a much easier ride.