Advice for first-time buyers: How to get the best for your money

If you’re ready to take your first step on the property ladder and become a homeowner, there are a few factors you need to take into account. From assessing your finances to making a successful offer, here are some of our best tips and advice for first-time buyers.

Work out where you are with your finances

The very first thing to do if you want to get onto the property ladder is to know how much you can afford. It sounds like we’re stating the obvious, but it helps you avoid disappointment later on down the line. The general rule is: the bigger your deposit, the lower your monthly mortgage will be. There are a few homeownership schemes that could help you with this!

Most mortgage lenders require you to pay a deposit of at least 10%, so, depending on where you’re looking to buy, it’s a good idea to save up as much as you can. For every 5% more you can put down as a deposit, your monthly mortgage repayments go down considerably!

Remember, you’ll also need to pay for stuff such as surveys, stamp duty land tax (SDLT) and, potentially, moving costs. First-time buyers don’t have to pay SDLT on properties worth less than £301,000.

Get a mortgage adviser to take a look at the state of your finances. They will look at your income, debts and the deposit you’re prepared to pay. The mortgage adviser will then be able to work out how much you can comfortably borrow. This gives you a much more accurate picture of what you can get in your chosen location.

The next thing to do is get a ‘mortgage agreement in principle’ with your bank. This will show the seller you’re a great candidate to purchase the house.

Finding the house

It’s OK to be picky when you’re house hunting – after all, you’re investing your life savings in your first home! Start with the location first before you go all out in the search. This is one of the most important factors and it’s the hardest one to change. Then it’s time to filter your search down as much as you can. This includes parking, number of bedrooms, bathrooms, reception rooms, garden and so on.

Unfortunately, you may have to compromise with certain things such as fireplaces and wooden beams – you’ll need to downgrade them from “must-haves” to “nice bonus.” Choose five absolute essentials your first home must have…and stick with them. Read our blog “Property search secrets to finding your dream home” for more house hunting tips.

Haggling and making an offer

If you’re a first-time buyer, you won’t have a house to sell so the ‘chain’ will stop with you and you’ll be considered one of the strongest links. This means you could have more leeway when it comes to putting in an offer. Usually, you’ll go through the estate agent to put your offer in. The estate agent is effectively the seller’s professional negotiator, whereas the buyer usually has to fend for themselves.

Generally, you should offer 5 to 10% lower than the asking price. Your estate agent should also tell you if someone has beaten your bid, giving you a chance to make a second bid. There are, however, a few circumstances where your lower offer may be accepted:

  • If the seller is looking for a quick sale because they’re relocating for a job or they’re going through a divorce
  • If you decide on a completion date that works well for the seller
  • If the property has been on the market for a while
  • If you’re not in a chain and the seller doesn’t have to wait for you to sell your property
  • If the seller is using a number of estate agents to sell the property, so the estate agent you’re dealing with wants to get in there first with a sale

Once your offer is accepted it’s crucial that you instruct a solicitor for the completion stage. If you’re in the process of buying or selling a property don’t hesitate to get in touch with our conveyancing team. Use the button below to get in touch with our conveyancing team today:

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