Buying your first home: what you need to know
What you need before you buy your first home
The deposit
When putting a deposit on a home when you are a first-time buyer, you need to remember that you are no longer renting, so the deposit you give affects the mortgage rates you get.
It is advised to save as much money as you can over a long period before you buy to better your chances of getting a good rate on your mortgage.
It is said to take first-time buyers just under 10 years to save a 15% deposit of their mortgage, so the more you have saved the better.
Knowing the different types of mortgage
There are several mortgage types, so you should be certain which one you require before you apply, as each one depends on your financial situation. You could end up saving thousands by choosing the right mortgage.
There are two main types of mortgage in which you pay interest over time.
A fixed-rate mortgage means the interest rate will not change over time, whereas a variable mortgage’s interest rate can increase or decrease.
Buy-to-let
Many purchase a property or use their empty second home to earn a passive income with short-letting or holiday-letting. As you become a property owner, you can choose to use it for money-making purposes, especially when your property is empty. For example, using a buy-to-let model, you can acquire property and use it to generate a second income through popular sites like Airbnb. But be careful, as this can become a full-time business, and you might need some help with Airbnb management. See our recommendations. Learn more about getting started with buy-to-let.
Home Renovations
75% of people would be open to buying a property that needed work, from an out-of-date kitchen to a bathroom with faulty plumbing. People tend to focus on location over the condition of the property.
For first-time buyers, the most sensible thing to do, in terms of investment, is to update an out-of-date home. If the property is in a sought-after location, you will save more money renovating it when it comes to reselling.
If you are looking to re-do a home, there are some things you need to consider regarding costs.
You should start by choosing trustworthy renovation builders with several testimonials.
You will save more money by employing home builders you can trust.
The moving process
Moving house can often be the most stressful part of home-buying, so preparing early is important. You usually have about a month to move out of your property once it has been sold. If you are buying or building your new property, you may not want to start packing things until you can move into a new place. You should pack methodically, packing things you won’t need immediately and putting them into storage. Hiring a company to help you with the moving process may be best to reduce stress and confusion.
