We all like to think that we are ready to buy and invest in property. Most of us see buying our first home as finally becoming an adult and making something of our life. Or, we simply want reassurance that something belongs to us. That we have a capital investment, we can use to keep the future of our finances bright. There is certainly something comforting about knowing that you own the house you’re living in. If you lose your job, run into financial trouble or need to start thinking about the future having property makes things easier. But are you ready to buy your first home? To answer that question, we need to look at a few factors.
The Mortgage
Your first job when buying a home is to look at the deposit. You need to think about how much money you can put down on the property. Five percent will allow you to buy any home. But ideally, you want to be looking at around twenty-five percent of the asking price to get some of the best mortgage deals. That’s important because if you don’t get a good mortgage, a house buy becomes a very expensive commitment. It’s the interest rate that could kill you on repayments which will eventually rise. Although, depending on the deal it could be frozen for the first couple of years of earning your home.
You might be wondering how to find out what type of mortgage you can get. Or, you could be asking the question: how much house can I qualify for? You may want to think about using a calculator tool. This will ask you about your savings, your income, the cost of the home in question and work out how much you can afford.
The Expenses
A lot of people think that buying a property means the end of heavy expenses. Instead, costs instantly become far more manageable compared to, let’s say renting. This isn’t the case at all, and in fact, you’ll find owning a property is far more expensive. Bills, in general, are usually a lot higher, particularly if you’ve been used to living in a flat and have moved to a house. Or, if you have been living alone and are now sharing a house with someone else. The bills can be anything up to double what you’re used to. And, that’s not even the only cost that you’ll need to handle.
Unforeseen Expenses
It’s absolutely vital that you have a good amount of savings even after you pay the deposit on your property. This is because houses often do develop problems, particularly if you don’t buy one brand new. For instance, you might find that the boiler breaks down and needs a repair. If that happens, you could be looking at spending anything up to ten thousand. That’s certainly going to hit your finances hard. So, make sure you have a nice cushion of cash to fall back on if anything does go wrong.
If you have thought about all these issues, then you will be financially ready to buy your first home. Good luck.
