Buying a home is one of the biggest steps you will take in life.
With the most affordable mortgage repayments existing on the longer terms of 30 and 35 years, it is not an overnight decision, nor a short-term one.
For first-time buyers, the questions can feel endless and complicated. How long does it take to buy a house? What do we need to be wary of?
House buying is complex, and it can be stressful, but it is ultimately something anybody can do once they’ve secured their funds and made the commitment.
Here we outline some of the most pressing questions together with essential tips for buying a house.
How do I buy my first house in the UK?
First things first – it’s time to shop around.
There are plenty of places to browse houses on the market, and many of them can be accessed with a few taps of your phone screen. Big property sites such as Rightmove and Zoopla list hundreds of thousands of homes that can be searched and filtered to your preferences.
Talking of needs, it’s important to know yours, and identify what you are ultimately looking to buy. Two houses of similar size and location could vary drastically in price for the sake of an extra bedroom, and some houses may have reduced prices owing to the need for remedial work or modernising.
Online property browsing is quick and convenient – and it gives you an overview of the types of available houses in the areas in which you’re looking to buy – but there is still a lot to be gained from taking the route of approaching a high street estate agent.
The benefit of enquiring with a high street agency is that you get to speak with a real person while outlining your needs. You can work with people who know the market first-hand and can provide advice or suggest properties from the agency portfolio that might suit you.
Once you’ve found an available property that you’d like to buy, the process begins in earnest by placing an offer. If it is accepted, then congratulations – you’ve taken your first step towards purchasing a home!
How can a beginner buy a house?
While experienced buyers may be more confident and knowledgeable when it comes to buying a house, there are no real penalties for beginners; you have as much right to view houses and put in offers as anybody.
It may be beneficial to brush up on terms and processes that will be crucial parts of the home buying process. Terms like ‘conveyancing’ and ‘chain’ might be thrown around with ease by agents and solicitors, but it’s easy to quickly get lost when these words mean nothing to you.
The best way to arm yourself with the right knowledge to take a look at a glossary of property terms like ours, to ensure that confusion isn’t the biggest barrier to an informed and confident purchase.
Being a beginner homebuyer could, in some ways, be an advantage when it comes to dealing with the current owners of a home you’re looking to buy. Sellers reserve the final say in who gets to buy a property, and some sellers may be swayed by seeing an eager first-time buyer over somebody looking to expand their portfolio.
There are also some great incentives for beginning buyers, like the government’s Help to Buy and affordable home ownership schemes. Help to Buy ISAs are no longer available, but loans to aid with the cost of a new-build home still exist through these schemes. This does, however, limit you to looking at new-build properties exclusively, should you need one of these loans to make buying a home possible.
Who qualifies as a first-time buyer in the UK?
Being someone who can be classed as a first-time buyer is not as simple as it seems on the surface.
Many first-time buyers are buying as couples – what happens if one of you has owned a home before? Or if one of you has inherited property?
First-time buyer status applies to an individual if they have never owned a property used for living purposes. If one person in a couple has indeed ever owned a home, they will not qualify as a first-time buyer. Despite this only applying to one person in this example, it means that the couple will not quality for stamp duty relief or Help to Buy.
Note that the wording applies to people who have ‘owned’ property before. The phrase ‘first-time buyer’ is slightly misleading in this regard, as people who have owned property they did not technically buy still do not qualify as a first-time buyer. This includes property they have inherited or property that was bought for them as a gift.
Commercial property does not apply, so long as there aren’t living quarters attached. People who own a property for a business but are hoping to buy their first home to live in will still qualify as a first-time buyer.
First-time buyer status is not something that should be sought dishonestly. If you sign a declaration which misrepresents your homebuyer status, you are committing a criminal offence and could pay with the loss of your home. Plus, it’s far too easy to search the UK Land Registry and other places where your name may come up from past purchases.
How much money should you have before buying a house?
Many homes are bought with the help of a mortgage because first-time purchases for younger buyers are often out of the question without one. This means that you don’t necessarily need a huge cache of money set aside to buy a home, but it doesn’t mean your finances are irrelevant – far from it, in fact.
Mortgage lenders will deep dive into your finances, both current and in recent history, in order to make their assessment of whether or not you present a good investment choice.
Different lenders will have different criteria, but it is generally accepted that you’ll need to have several months of payslips or any other proof of income, as well as proof of your outgoings and explanations of what your typical spends may look like.
Overall, lenders will want to get as clear a picture of your financial health as possible. This could also involve credit checks and you may need to explain individual purchases if your advisor wants to know how often you might splurge on purchases.
You don’t necessarily need to be wealthy to be eligible for a mortgage, but you do need to know your own finances and demonstrate sensible spending and good financial health.
Conversely, you may be fortunate enough to have the funds for an outright purchase of a home, which simplifies the process by completing negating the need for a mortgage.
How much your mortgage costs depends on the value of the home you’re looking to buy, how much the lender is willing to provide you, and over how many years you intend to pay the mortgage back. Luckily, you don’t need to commit to a mortgage in order to find out how much you can borrow.
A mortgage in principle – also known as an agreement in principle – is a projection of how much you could be lent with your finances as they currently are. They’re a useful form of proof that either you need to make some changes to afford the home you want, or that you can rest assured that you could get that home in principle (thus the name).
Mortgages in principle are not the same as assured mortgages. There may be other factors that complicate or delay a hard agreement, so take them with a pinch of salt.
Even when a mortgage is signed and agreed, things are not set in stone forever. Mortgages can be transferred between properties, or you may remortgage from one lender to another without moving home. If your finances improve over time, there is room to work with your new level of funds.
Who is eligible to buy a house in the UK?
Many people are eligible to buy property in the UK. Citizens are of course eligible, as are residents and foreign nationals, though there are certain factors that may affect this eligibility in various ways.
Foreign nationals are typically expected to have both two years of residency and a job within the UK. Those who have not spent that much time aren’t necessarily restricted from purchasing a house, but they might face bigger deposits and more checks than resident buyers. That having been said, property value itself will not be changed between citizens and foreign nationals.
Expats hoping to buy a house in the UK can apply for a special mortgage fittingly called an expat mortgage. In function, there is little to no difference between a traditional mortgage and an expat mortgage. Both include lending money for the purpose of purchasing a property, which is paid back in agreed installments.
The main difference with expat mortgages is in the process of securing one. Lenders may see expats as more of a financial risk, and changes in exchange rate could drastically affect how healthy a person’s finances appear on paper.
How big should your first home be?
Not everybody buys their first home at the same stage in their life. Many first-time buyers try to secure homes before starting a family, but others may be looking to break away from renting a property after raising two children into their teenage years.
Your first home should be as big as you need it to be. There is little sense in spending more money and tying yourself into a bigger mortgage for a property with extra room that you don’t need.
The size of house you can secure in the first place will depend on where you are shopping for a home. Places like Cheadle will have a great range of property sizes to choose from, whereas other places in the UK may limit you to a certain number of bedrooms or a certain property size due to price.
There is always room to try and negotiate with sellers and buyers with no chain are often an attractive prospect, so first-time buyers should weigh up the space they need (or will need in future) against what they can afford without hamstringing themselves financially.
Buying your first home with Mistoria Estate Agents
We’ve helped many people secure their first home and we have the expertise to help you too. Our Cheadle office is full of helpful, knowledgeable staff that can demystify the process, providing tips for buying a house and making the process as smooth and painless as possible.
If you’re thinking of buying your first home or just need some early advice, get in touch and chat with us today.