Steps to buying first home

byeo

byeo

byeo

Soldato
Joined
11 Sep 2013
Posts
2,732
Location
South Yorkshire
Morning everyone,

I've been putting money away in my Lifetime ISA for the past year and have got £5000 in there right now. My goal was to buy next year once I had paid off our 2020 holiday. As of Monday afternoon things have changed as my girlfriend told me that she's pregnant and due in November, it wasn't planned but that's our not the issue, currently my girlfriend lives in Nottingham and I'm in Sheffield.

I've started by cancelling our holiday which we'll get some money back and also moving our holiday savings to my ISA, so once the 25% bonus is paid, I'll have 10k before the end of the tax year. I've worked out come May I will be able to stick another £4000 in my ISA, plus the bonus which will give me a 15k deposit. Obviously I need to consider additional fees I'll incur so need some saved for that.

No-one knows about the baby yet but once we tell family I am considering asking my Grandad to possibly gift me some money which can be either used to pay fee's or towards the deposit though a gift towards the deposit needs written consent does it not?

Anyway, sorry for the long winded backstory, once I've got the deposit in place (15k plus), what do I do? Do I see a house I like and take it from there, do I see a mortgage broker first, get a an idea of what house prices I should be looking at. Honestly I've no idea, my parents haven't got their own home so they can't advise me to a great extent.

The baby will change our lives but making sure I get a house is the one thing which worries me the most, making sure I buy a house in time for the baby arriving.

Thanks for taking the time to read.
 
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1. Mortgage in principle - shows that you have available funds to buy a house and are serious. Also helps to decide your budget and what is realistically affordable for you. You can either go through a broker or just look online for price comparisons.

2. Find a good solicitor. Ask family and friends for recommendations. This cannot be an afterthought. Contact them well before you make any offers to say that you’ll be instructing them.

3. Go house shopping. Don’t rush, don’t play estate agents’ games. You’re in a strong position as a first time buyer with a mortgage in principle and a solicitor ready to go.

4. Good luck!
 
We did similar 4 years ago. Got pregnant before buying. We were moved in within 5 months after viewing a few houses. Helped my mate was a mortgage broker and helped with most things. As poster above says MiP, 1st time buyer you're in the best position.

I have no idea what happens when we move up the ladder with buying AND selling at same time.
 
Maccapacca said:
Congratulation the new baby :)

Can you jump on one if these help to buy schemes as well? Fixed date and move into a new house?
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Yes I would look at help to buy also - speak to a broker to begin with then go from there.

Lots of agents have brokers that they recommend - well worth a free chat with one
 
Thanks for the advice, do I need to have the deposit ready and waiting before I go and speak to a broker or can I start talking to them now before I get my full deposit in May?
 
No just start talking.

It's not particularly taxing.

Just remember everyone is on a fee so consider they aren't out for you.

How do you when an estate agent is lying? His lips are moving :p
 
You can speak with a broker for advice only but they may charge a fee if you aren't in a position to sign up so they get commission. Most independents are decent people and recognise a potential repeat customer so may do it for free anyway.

Dont forget you need to consider conveyancing, surveys and stamp duty fees on top of your deposit unless you load it onto the mortgage.

Get on rightmove and start working with your budget and expectations. Buy smart and you will be set up for life. Dont get blinded by newly built or renovated places with all the bells and whistles. Its often cheaper to get a house needing updating and do it yourself.

I made an £80k profit on my first house within 5 years by buying a house that needed work on a brilliant street. It's meant I have been able to build a 4 bedroom bungalow on a sizeable piece of land with a relatively low mortgage.

If you like a house, engage directly with the owner. When I sold my last house I was offered £3500 more by one couple over another who offered the asking price. I took the lower offer as I liked them more and felt it would be more streamlined sale.
 
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Get a mortgage in principle however you likely won't be able to use all of your partners income or need to advise them she will be off work and on maternity pay, etc. This will effect how much you can borrow substantially I imagine.

Once you know what the bank is willing to offer based on all the facts including the reduction in HH income. You can then look for properties below that budget.

Lets say the bank says we are willing to offer £200K. I would be looking at properties in the £150k-£175K bracket. As it will be offers over. If you look at properties in a bracket close to the maximum as possible it's likely you won't get them.

You will need anyone who gifts you money to write a legal waiver saying it's a gift this will need to be verified by your solicitor as will all sources of funds for the purchase of a home.

Start looking as soon as possible and look at everything including ones you don't like. This will help you pin down exactly what you can get and exactly what you like and don't like.

I viewed flats, semi detached and smaller detached houses and I decided on a slightly larger detached house in the end. The rooms were just far too small in the others to work with for what I needed and wanted. Plus it's good having the private garden, driveway, etc. These would now be classed as essentials for me but before with looking at flats it wasn't a major consideration.

Also be realistic. Yes everyone would love a 7 bedroom mansion with 5 en suites and massive rooms. However the bigger the house the bigger the running costs too. More gas and electric. Higher council tax. Higher maintenance and refurbishment costs. So it's best to go for something cosy as a starter home. It will then give you a realistic view for the future of what your potential is for moving up the ladder.

If you overextend and then find yourself short of cash every month it will be a very stressful life ahead for you. Better to be comfortable and stress free in a slightly smaller home as you always have the possibility of buying a bigger home in 5-10 years time. Whereas if you overextend you will lose a lot of cash in selling up to go smaller.

I believe people say your mortgage should be no more than 25% of your monthly HH income after tax. So if you earn say £3000 per month after tax. You should be looking to pay £750 per month towards a mortgage at maximum to be comfortable.
 
Thanks for all the advice, I'm going to have to do some serious calculations on what I can and cannot afford.
 
Maccapacca said:
No just start talking.

It's not particularly taxing.

Just remember everyone is on a fee so consider they aren't out for you.

How do you when an estate agent is lying? His lips are moving :p
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In most cases brokers are paid by the lender and do not charge a fee of the client - all they need to do is present you with the options and whichever bank you choose pays the broker in turn
 
psd99 said:
Might be true in Burnley lol Not in London though very unrealistic

Good luck though.
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he's in sheffield / nottingham. so your post isn't helpful.

also i would say if you are paying more than 35% of your HH income in London then you are better off just moving elsewhere. the place is a terrible to live in. i had someone from the borders complain that it took ages to get anywhere in glasgow due to traffic lights, etc. i told him it takes me 15 mins to get to work with 3 traffic lights and i work in the city centre and live about 12 miles from the office. in london that same commute would take me 90 mins i imagine and be crawling along for the full journey.
 
Back off! The two most stressful points in a relationship are buying a house and having children. Remember that if she leaves, she will keep the house. Move in together first, become a family, and then - in a year or two - start looking for a home.
 
Quartz said:
Back off! The two most stressful points in a relationship are buying a house and having children. Remember that if she leaves, she will keep the house. Move in together first, become a family, and then - in a year or two - start looking for a home.
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Pretty damn good advice.

Find somewhere to rent, not somewhere to buy. Keep saving as much as you can while doing this. Surely you both live somewhere now so 2 separate places should cost you more then 1 combined, unless you are both still living at family homes, in which case renting somewhere will cost you more, but will take a huge pressure off you while you start to develop and build your family together.
 
Syla5 said:
Pretty damn good advice.

Find somewhere to rent, not somewhere to buy. Keep saving as much as you can while doing this. Surely you both live somewhere now so 2 separate places should cost you more then 1 combined, unless you are both still living at family homes, in which case renting somewhere will cost you more, but will take a huge pressure off you while you start to develop and build your family together.
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We’re currently living apart, she’s in Nottingham and I’m up in Sheffield. If it comes to the worst and we’re going to struggle to get a mortgage then I would ask my parents if they could out us up for six months while we save that bit more which would enable us to get a mortgage. Not ideal but better than renting and saving not much at all p/m.
 
Living together you will spend less on rent than you do living separately. You will also save on council tax, energy bills, and so on.
 
Following as I'm in basically the same position but in London :)

I've been saving for a while but decided not to keep asking family and colleagues what they did, and walk into my bank instead. Put the facts on the table and ask what my options are. Good advice in here I think!
 
byeo said:
We’re currently living apart, she’s in Nottingham and I’m up in Sheffield. If it comes to the worst and we’re going to struggle to get a mortgage then I would ask my parents if they could out us up for six months while we save that bit more which would enable us to get a mortgage. Not ideal but better than renting and saving not much at all p/m.
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are you both renting currently?

also why are you living apart? are you moving in together now because of the kid? that doesn't sound like the best circumstances to make that decision under tbh.
 
Psycho Sonny said:
are you both renting currently?

also why are you living apart? are you moving in together now because of the kid? that doesn't sound like the best circumstances to make that decision under tbh.
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We are living apart at our parents homes because I was in the process of saving for a deposit to use in 2020.
 
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