I am 23 years old and currently in the process of buying my first house. Yes it’s true: despite having been born in 1992, I have managed to get my foot on the first rung of the elusive property ladder.
In the current economic climate, buying a house seems like an impossible dream for many people my age. The cost of private renting is too high, saving is too difficult and time is moving too quickly. I had these very worries, unable to see how I would ever be in a position to even think about owning a property.
Fast forward to the present and I’m weeks away from completion. It hasn’t been easy, I’ll admit. It has taken perseverance, sacrifice and (a whole lot of) patience, but I stand as proof that the life of a twenty-something isn’t destined to be a damp flat and an awkward landlord. It is possible! Here’s what I’ve learned over the past months – if nothing else, I hope it will provide my fellow millennials with a little encouragement and hope for the future.
1. Don’t go kayaking without a paddle
Well, you wouldn’t, would you? And likewise, you shouldn’t go property searching without knowing the facts. Truth be told, when I first started to seriously consider buying I was pretty much oblivious to the extent of the cost. On top of the deposit, there are mortgage advisers, conveyancers, surveyors… All of these vary in cost, although even the least expensive options are going to set you back a few thousand at least. You need to know exactly what this business is going to cost you from the word go.
But don’t be put off – it’s still possible. My point is simply that, before you do anything, you absolutely must figure out all the different costs that come with buying a house and work out how much you’re going to need overall. This way you’ll be saving with a clear goal in mind and be spared a lot of stress down the line. Ask other people for help too – nobody knows the costs better than a person who’s been there and got the t-shirt!
2. Make use of the help that's out there
The government runs a number of schemes to support people in buying property, including the Help To Buy ISA for first time buyers. Check out helptobuy.gov.uk for more information on what’s available for you.
3. Make small changes for better things
Back when I was spending just over half of my total monthly income on a private rented flat, I was just about managing to save £10 or £20 per month. It’s times like these that you have to make a decision – could you give something up in favour of better future prospects? Find a less expensive flat? Move closer to work to reduce commuting costs? Get rid of the car altogether? Provided it’s feasible under your own circumstances, a temporary downgrade in certain areas can ultimately open up lots of doors for you.
I chose to move back in with my parents. The perks included paying a lower amount for board than I had been for rent every month, which meant increased savings. The downsides included going from a spacious flat back into my pokey childhood room, complete with wilting posters on the walls from when I moved out five years ago. It hasn’t been ideal at times but, in the long run, a sacrifice worth making.
4. Be strict with your savings
So you’ve made some cuts to your expenditure and you’re saving more than ever – happy days! Alas, what feels like a sudden cash injection can lead to a temptation to spend, so try not to lose sight of the end goal. Perhaps keep a picture of your ideal house or sticky note reminders where you’ll often see them (on the fridge, in the bathroom) or where temptation most often hits (in your wallet/purse, on your laptop).
5. Get your head around mortgages, they're going to become a big part of your life
I remember when my understanding of a mortgage relied on the Monopoly instruction book. As it happens, it’s a little more complex than that. A mortgage adviser should be able to help you get to grips with it, but be aware of extra cost and, importantly, make sure they’re regulated.
Bear in mind the amount you’ll be allowed to borrow on a mortgage will depend on your salary and circumstances and you’ll have monthly repayments to make. As every piece of correspondence will tell you in blaring red letters, your property may be repossessed if you don’t keep up with your repayments!
6. Fight with the wallpaper, not the neighbours
Finally, you’re ready to start property searching. A young person looking for their first home can easily become like a child in a sweet shop. You’re immediately drawn towards the first beautiful house you see, fall in love with it and the rest is history. Yes, this was me, until my wonderful dad gave me a great piece of advice: go for the worst possible property in the best possible area. You can fairly easily fix up a house, but it will be considerably more difficult to fix up the surrounding area. Essentially, be mature about it, know your priorities, and remember your heart and your head both make points worth taking into account!