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Buying a first home is such an exciting opportunity and it is easy to get caught up in the moment when you start your search. Even with a very good deposit, you need to consider the monthly costs you can afford in order to pay off your mortgage. You should also consider that in your first month or two, you may be paying rent and mortgage repayments together as you move.
There are all sorts of additional costs when you buy your first home so you need to be aware of which costs will arrive and when. This will help you to organize your finances and be sure that you have saved enough to make sure the whole process goes as smoothly as possible.
There is plenty of advice on the internet for home buying for beginners but here are just 3 things you need to consider before you take the plunge and make an offer.
Saving For a Deposit
The bigger your deposit, the easier it will be to afford to pay off your mortgage. If you use a small deposit, you may find that your monthly repayment plan stretches your income to a breaking point. This means that it may be worth renting for a few more months before you start your search.
Though the temptation is to get as much property as possible for your money, you should thoroughly consider whether the property is in a good location for you. While bigger properties are often cheaper outside city centers, if you are then having to pay much more to travel in for your job, a smaller property nearer to your office may be more economical.
Saving up so much money can be a really difficult process, but don’t be disheartened. There are all sorts of ways to reduce your monthly outgoings that won’t be too painful to achieve. It might be something as simple as preparing bulk meals in advance and freezing them or switching energy suppliers to get a lower tariff.
Work Out Your Ongoing Costs
Before you do anything, work out what your monthly income is and what you can afford to pay in mortgage repayments each month. You should also take into account any other monthly costs you may have such as credit card debt or building maintenance. These costs will impact the amount you can pay in mortgage repayments. Ideally, you will be able to gradually pay off your credit card debts before you put down a deposit to give yourself more financial flexibility.
Regardless of the size of your deposit, if you can’t afford the monthly repayment, you can’t afford that property. This means that you either need to find something cheaper or continue to save. Doing the math now will save you a lot of trouble later on and will give you a good idea of the kind of properties you should be looking at. Though there is nothing wrong with house hunting at the top of your budget do have a look at a range of properties to get an idea of what you can afford and what you actually need. Have a look at these house hunting tips to get an idea of what you should look for.
Consider Furnishing and Home Improvement
If you have a lot of your own furniture already this may not be a problem, but if your rented property is furnished, you will need to save for your own things when you move. Furnishing any property is the most wonderful feeling as it gives you the chance to fully express your personality and get what you want. However, be wary of buying everything all at once.
A good idea is to buy very cheap second-hand furniture to start with so that you have a functioning bed, sofa, and wardrobe (or even cheaper, a clothes rail). Once you are settled in and your finances are looking a little clearer, you can start saving for the things you really want. You could even start a creative side hustle to gain the extra funds required.
If there is one thing you should consider an investment, though, it is a perfect mattress to ensure you get a really good night’s sleep. Sleeping well is incredibly important and will have a big impact on your lifestyle and wellbeing. The most expensive mattress isn’t necessarily the best mattress for you, but going to the store with a large budget will give you a bit more freedom in your choice. Of course, any money you don’t spend can go on other house furnishings.