Saving for any big purchase is challenging, and purchases don’t get much bigger than a first home. It can seem impossible for young 20-somethings to ever get on the property ladder. Housing is so expensive, and well-paid jobs can be hard to find. Buying a house is a great investment, though, and once you're on the property ladder, you’ll reap the rewards. If you’re struggling to save, take a look at this advice. Hopefully, there are some money-saving tips you can use in your day-to-day life.
Do Your Research
There are plenty of schemes out there which help first-time buyers. There are also plenty of ideas which lower the costs of mortgages.
For younger people trying to buy their first home, a parent might be able to help out with a more informal loan. They can even act as a guarantor. This will make them liable for mortgage payments that you can’t make.
If that’s not an option consider buying your first place as a group. If you don’t mind living with friends or siblings, it will lower the cost if you split it between you. This takes lots of prior negotiations, though. You will need to consider what happens if someone wants to sell their share.
Shop around for the best mortgage deals. Some schemes offer first-time buyers a better deal. You could pay as little as a 5% deposit and the government will fund the rest. This will mean your mortgage repayments are greater so always research thoroughly.
Getting a loan is another options. A homeloan calculator will help you to work out what you can afford to borrow and your monthly repayments. Just make sure you can afford to take out a loan in the first place.
Finally, some mortgage deals will actually cover some of the costs. Valuations and legal fees are included in some deals and paid for. This will reduce the amount you need to pay upfront.
Tips on Saving
Start saving as soon as possible. This may seem obvious but it’s the best piece of advice out there. There is just no getting around the fact that deposits and mortgage repayments are expensive. Not to mention the stamp duty and legal fees.
You may want to make all your rooms look perfect in your new home, but start off small. You won’t have the money to redecorate all of your house straight away. There are enough costs to worry about pre-moving in! So don’t become too bogged down with saving for furniture or anything like that. Just focus on your deposit and mortgage repayments, to begin with.
Set up a savings account and create goals for how much you want to save each month. You can even set up a direct debit to take this amount out of your account each time your paid. That way you can be sure you’re investing in your future. Ask your bank about the best savings account. Over time your savings could even accumulate some interest.