Small things that make a difference
5 ways to help save for your first deposit.
Firstly, I want to say how much I sympathise with everyone looking to get on the property ladder. It’s not easy, in fact, there are so many obstacles and barriers that it can feel impossible. I wish there was a magic wand to wave that would get you the deposit you need and into that first time buyer club, but sadly there isn’t. The best I can do is tell you that I have been privileged to help many people to get that first mortgage and we will do all we can to find you a mortgage when you are ready. Perhaps one other thing I can do is pass on some of the tips that were given to me by successful first-time buyers. So here are 5 of the best ones.
1. Have you thought about shared ownership?
Shared ownership schemes are offered by many developers and because of the reduced cost they reduce your initial deposit considerably. With a shared ownership scheme you will usually pay a mixture of a mortgage for your part of the home and rent to the other owner. Shared ownership mortgages are available, and we can advise you on the best deal. Most importantly though, with a lower deposit you may be able to reduce the initial cost.
2. Is it possible to cut back on spending or declutter?
Sorry, I apologise if you are already doing it but it’s always worth another look. The trade off between a little hardship now and getting your deposit together is not an easy one to accept but you would be surprised how quickly small amounts add up to a bigger sum. Buying a home is a long term investment and all the sacrifice now will pay off in the future. Decluttering and downsizing can really be a surprising boost to your savings. Selling off all those bits of things that you can really live without can make a fair amount of cash. Downsize the car. Rent a smaller place. Take a shorter, less expensive holiday. They feel like sacrifices but honestly, you are only really delaying the holidays and once you are in your own place you can buy replacements over time.
3. Could you lower your sights a little?
I don’t want to discourage you from your dream home, more suggest it may be worth a little delay. Many first time buyers find that they can reduce the deposit required by looking at houses that need a little work or are not in quite the right area they initially wanted. Consider a flat rather than a house maybe? Getting on the ladder in a temporary home may be the doorway to one more suited to your long term needs.
4. Avoid the road to Hell…
I mean the one that is paved with good intentions. If you find you are tempted to dip into your savings set up direct debits that go out on payday and avoid any way of saving that allows instant access. We all mean well and then we chip away bit by bit at our savings. Usually though we do it on impulse so if you take away the opportunity it will make life easier.
5. Make a detailed plan rather than general goals.
If there is one tip that always seems to get results it is plan effectively. Get really detailed if you can. It’s important to know what you will need and exactly how to get there. One of the biggest reasons for doing this is the comfort of seeing the milestones being passed and knowing that you are getting closer to your goal.
I hope some of these tips are useful and that they perhaps help you on the way to your first home. There are also a few Government-Backed schemes designed to help people get on the property ladder such as the help to buy scheme. Also check out our previous post First Time Buyer what you need to know.
When you need to know where you stand we will be here to advise you. Call us and let’s see how we can help.