Top tips for saving for your first home
First off, congratulations! You’ve made the decision to get onto the property ladder. It’s a big step but certainly one that is worthwhile.
The first stumbling block that will hit is the saving the deposit. Rising housing prices have meant that first-time buyers need to amass tens of thousands of pounds for a deposit. It can be a daunting task, saving a large sum of money. And it can seem like the figure is a million miles away but if you have the right mind set and save in the right way, it won’t be long until you’re picking up the keys to your first home.
If you’re a first-time buyer wondering what you need to buy your first home, we’ve got some helpful advice.
Figure out how much you need
The deposit will obviously vary for a one bedroom flat and a two bedroom semi-detached home, so figure out the price range for the type of property in the area you’re looking to buy
Don’t panic though as, wherever it is you are buying if you only have a five per cent deposit, there are some commercial lenders that may give you a 95 per cent mortgage. You’re more likely to get a mortgage though with a higher deposit, so aim for at least ten per cent. The bigger the deposit, the more types of mortgages will be available to you.
Remember, it’s not just the deposit that you’ll need to save for, there is also survey costs, solicitor’s fees, removal costs, building insurance and stamp duties that may need to be factored into the equation.
Once you’ve figured out a target amount and a date that you’d like to reach your target, work out how much you’ll need to save each month. For a £10,000 deposit over four years is £208 per month but if you feel that you can save faster you can reach the same amount by saving £418 per month for two years.
Cut your spending
Sounds simple but there are many ways for you to save money. Little savings all add up and making compromises and adjustments can make the difference. Sacrificing that daily cup of coffee on the way to work can alone save you hundreds of pounds each year.
Where you choose to save your money is an important choice. One option that is particularly suited to first-time buyers is the Help to Buy ISA, a government scheme that gives first-time buyers a 25 per cent bonus on the amount that they have saved, up to the value of £12,000.
So, if you save £10,000 in the ISA, when you come to use that money to buy your first property, the government will give you a £2,500 bonus. You can only add up to £200 each month so it’s best to open the ISA sooner rather than later.
Buying first home in Harborough
If you are looking to buy your first home in the Harborough district, Naylors Estate Agency is experts in the area. Our team that has a specialist knowledge of the town and surrounding villages so can propose expert advice in your move. For help in finding your ideal first home in the Harborough district, call Naylors estate agents today on 01858 450 020.