Buying a house is seen as much more difficult for younger people than it once was. But while the average age of first-time buyers is higher than ever before, Gen Z and other young buyers are breaking into the housing market. If you’re buying a house for the first time, well done!
It’s a potentially scary and overwhelming process, but the benefits of buying a house can outweigh the costs. You will save money in the long run and, at the end of the day, you will have a physical asset to fall back on. Here are some tips to help you through the process, especially if you’ve never bought a house before.
The vast majority of people buying a house don’t pay with cash or money they already have. If you have hundreds of thousands of dollars sitting around, then you can absolutely do this. But this isn’t the reality for most people, especially first-time buyers who can’t benefit from selling an already paid-off house.
Most people use a mortgage, which is a loan designed for property. This is a good deal for a lot of buyers, because the mortgage payments are usually less than they’d pay for rent. You can also sometimes pay off your mortgage early or overpay each month, meaning that you reduce the amount of interest you pay.
Another way to get a better mortgage deal and to pay less in the long run is to save up for as large a deposit as you can. Most deposits are between 5-10% of the value of the property, but a larger deposit can be a better investment.
As mentioned before, people who are buying their second or third home can get a head start by selling the property they had before. Even if they haven’t paid off the mortgage completely, the money they’ve already paid in can offset the cost of the new mortgage. If they’re downsizing, this can mean they end up with a smaller mortgage.
But what if you don’t already own a property to sell? First-time homebuyer programs are a brilliant way to save up for a larger deposit more quickly, and can be helpful when you’re buying your first home.
When buying a property, you need professional advice to help you find the new home and negotiate a sale. This means hiring realtors to help you find properties in your price range.
From there, a property solicitor will facilitate the house buying process and essentially make sure all the legal stuff is above board so you’re legally protected from potential hiccups down the road.
Once everything is ready, the last step is to arrange a moving date. As a first-time buyer, you don’t need to worry about selling your house and timing everything perfectly, but it is a good idea to speak to your landlord when the house purchase is underway so they can find a new tenant as quickly as possible. Depending on your contract, you might need to give them a few months’ notice before leaving.
