Essential First Time Home Buyer Advice for 2024
Updated: January 2024
Embarking on your journey as a first-time home buyer in 2024?
Get ready to turn the key to your new home with confidence. Our essential guide, packed with first time home buyer advice, is designed to navigate the highs and lows of the property market.
From saving for that crucial deposit to making your first offer, we cover all the must-knows for a smooth, successful home buying experience.
1) Review your Credit
A good credit score not only affects your ability to secure a mortgage but also influences the interest rate you’ll be offered. In 2024, with fluctuating mortgage rates, having a strong credit score is more important than ever.
Before you start house hunting, obtain your credit report from major credit bureaus and scrutinize it for any inaccuracies or areas for improvement. Paying off outstanding debts and ensuring all your bills are paid on time can boost your score. Remember, a higher credit score can significantly lower your borrowing costs over the life of a mortgage.
This step is about ensuring financial readiness. It’s not just about being able to afford the mortgage payments but also being prepared for other associated costs of owning a home.
2) Save Up for a Deposit
Once you’ve assessed your financial situation and determined that you can afford a home, the next vital step is saving for the deposit. In 2024, the significance of a substantial deposit cannot be overstated. The larger your deposit, the less you’ll need to borrow, which often translates to more favourable mortgage rates and terms.
Saving for a deposit requires a disciplined approach to finances. Consider setting up a dedicated savings account specifically for your house fund and automating transfers. Look for ways to reduce unnecessary expenses and, if possible, explore additional income streams.
The bottom line is, the larger deposit you put down, the better interest rate you will receive from a mortgage lender.
Related: How much do I need for a house deposit in 2024?
3) Look for the Right Home in a Good Location
Finding the perfect home isn’t just about the property itself; its location plays an equally pivotal role. This is where our first time home buyer advice becomes crucial. In 2024, with evolving urban landscapes and changing neighbourhood dynamics, selecting the right location is more crucial than ever. A good location aligns with your lifestyle and plans and can significantly impact the property’s long-term value.
When house hunting, consider factors like proximity to your workplace, quality of local schools (if you have or are planning to have children), access to public transportation, and neighbourhood safety. Also, think about the community vibe – whether it’s a quiet suburban area or a bustling urban neighbourhood – and how it fits with your lifestyle.
4) Get a Mortgage
Here are some key tips to guide you in selecting the best mortgage:
- Consult a Professional Mortgage Broker: A mortgage broker can offer valuable advice, helping you navigate various available mortgage options. They have the expertise to match you with a mortgage that suits your financial circumstances and home-buying objectives.
- Maintain a Strong Credit Score: As mentioned earlier, your credit rating significantly influences the mortgage deals you’re eligible for. A higher credit score can unlock lower interest rates and better terms, reducing your overall cost of borrowing.
- Explore Government Schemes: In 2024, various government schemes, like Help to Buy, are designed to support first-time homebuyers. These programs can assist with deposits and offer favorable mortgage conditions, making homeownership more accessible.
- Understand Mortgage Types: Familiarize yourself with different mortgage types. Repayment mortgages involve paying both the principal and interest, leading to full ownership at the end of the term. Interest-only mortgages, on the other hand, require only interest payments during the term, with the principal due at the end.
- Consider Your Long-Term Plans: Choose a mortgage based on your long-term financial and lifestyle plans. For example, if you plan to move or refinance in a few years, an adjustable-rate mortgage (ARM) might be more suitable. For stability in repayments, a fixed-rate mortgage could be the better choice.
Ultimately, the right mortgage should fit comfortably within your budget while also aligning with your future plans. Take the time to research and seek professional advice to ensure you make an informed decision.
5) Make an offer
Haggling is essential when buying, as most homes will always start above their market value. It’s your job to negotiate with the seller to reduce the price as much as possible. Remember, though, don’t bid too low, or the seller will think you’re just a time waster. Bidding too high means you will probably lose out on the property in the long run – keep it in the middle.
Related: How to haggle and negotiate house price
One great tip for reducing the asking price is to point out any flaws you see while viewing a property. Whether they are big or small is irrelevant; mention them, write them down and when it comes to negotiation time, be sure to bring them all up.
6) Surveys & Conveyancing
Conducting thorough surveys and conveyancing is a critical step in the home-buying process for first-time buyers in 2024. It’s essential to ensure that your investment is sound and to avoid any unpleasant surprises after moving in.
Related: What do surveyors check for in every home?
- Home Survey: Before finalizing your purchase, arrange for a comprehensive home survey. Organizations like the Royal Institution of Chartered Surveyors (RICS) offer a range of survey options that can uncover potential issues with the property, such as structural problems, dampness, or other defects. Opting for a detailed survey can save you from future costly repairs and provide peace of mind about your investment.
- Understanding the Importance of Conveyancing: Conveyancing involves legally transferring property ownership from the seller to you. A solicitor or a licensed conveyancer typically handles this process. They will manage critical tasks like conducting property searches, dealing with the land registry, and transferring the funds to purchase your new home.
- Regular Communication with Your Solicitor: Maintaining regular contact with your solicitor throughout the conveyancing process is crucial. Ensure you understand each process step; ask them to clarify any legal jargon or complex clauses in the paperwork.
- Review and Understand All Documents: It’s important to thoroughly review and understand all documents before signing. If there’s anything you’re unsure about, don’t hesitate to ask your solicitor for an explanation. Remember, once you sign a contract, you’re legally committed to the purchase.
- Be Proactive in the Process: While your solicitor will handle the bulk of the work, staying proactive and informed throughout the process will help ensure everything goes smoothly. Keep track of key deadlines and provide any requested information promptly to avoid delays.
By paying close attention to surveys and conveyancing, you can ensure a smoother transition into your new home, minimizing the risk of future legal or structural issues.
7) Exchanging contracts
Exchanging contracts is a pivotal moment in buying your first home, marking the point where the agreement becomes legally binding.
This crucial phase concludes most of the complex negotiations and verifications. It involves both you and the seller committing to the transaction, with solicitors ensuring satisfaction with the terms before exchanging signed contracts.
It’s essential before this exchange to resolve any remaining queries about the property, confirm the results of all necessary surveys and checks, finalize mortgage details, and prepare your down payment.
8) Moving Day
It’s finally time to move into your new home. A few things to remember include:
- Find a trustworthy moving firm.
- Change your home address for mail.
- Label all your boxes so their easier to sort out when you arrive at your new home!
- While this is going on don’t forget to have your contents insurance in place or for the policy to commence very soon after your belongings are at your new home.
Final Thoughts & Key Takeaways
Embarking on your home-buying journey in 2024 involves several key steps:
- Credit Review: Start with a comprehensive credit check to secure favourable mortgage terms.
- Deposit Savings: A substantial deposit reduces your loan amount and can improve interest rates.
- Home Location: Choose a location that aligns with your lifestyle and plans.
- Mortgage Selection: Pick a mortgage that balances present affordability with long-term goals.
- Price Negotiation: Effective negotiation is crucial in getting the right price.
- Property Surveys: Ensure thorough property surveys to avoid future issues.
- Contract Exchange: Understand the legalities and commitments during the contract exchange.
- Moving Day Planning: Meticulous planning is essential for a smooth transition to your new home.
Remember, success in buying your first home in 2024 lies in informed decision-making, financial planning, and understanding the property market’s nuances. This is the essence of effective first time home buyer advice.