Have you always dreamed of owning your own home? Not everyone in the world is as enthusiastic about owning their own home as the British continue to be, but with rising house prices, can you afford a house?
In the UK, getting on the property ladder is something that young people start to think about even before they have left school. Home ownership is seen as the key to future financial stability but the fierce competition for property and the high price, particularly in the South East, means that for many, that all important first purchase is a real stretch. Buying a house will only bring you happiness if you can afford it. No one wants to overstretch themselves and find that they are unable to meet mortgage payments, so a realistic appraisal of what you can afford is the crucial first step to a happy house purchase.
Use a Mortgage Calculator
A mortgage calculator will tell you how much you can afford to borrow by evaluating factors such as the size of your deposit, your current level of borrowing, your monthly outgoings and your income. The calculator will also show you what your monthly repayments are likely to be.
Create a budget plan
Creating a budget will help you save for that all-important deposit and the larger your deposit, the better the mortgage deal that you will be offered. Creating a budget plan will give you a target and a time frame within which to achieve it and will help you identify where you can economise on your current expenditure.
Research free house sale sites
Sites like Zoopla provide a lot of information about current and historical house prices. Developing an understanding of the variations in house prices in your area will help you to better judge the value of a house and give you a greater understanding of variables such as location, property type and state of repair. This will enable you to make a more informed judgement about whether the property that you are considering represents good value.
Consider the hidden costs
Moving into a new home, particularly a first purchase, is expensive. Have you taken into consideration the costs involved? As well as the usual one-off fees necessary for a house purchase, you should also take into consideration the cost of removal from your previous home and the purchase of necessities which you may need in order to make your home habitable. Whilst you may be prepared to live without certain items for a while, you are still likely to need to pay for items and services such as: carpets, curtains, kitchen goods, furniture and broadband amongst others.
Consider alternative forms of home ownership
You might be eligible for an equity loan from the government, which is a twenty per cent low interest loan designed to enable first time buyers and existing home owners to buy a newly built home. If you are unable to obtain a large enough mortgage you could always consider a shared ownership scheme which enables you to pay a percentage of the mortgage and rent on the rest.