Despite local ups and downs, wherever you go in the country, many properties remain frustratingly expensive.
But you donโt have to settle for renting, or living in a home that is too small for your needs. Even if money looks too tight for the kind of home that you want, there are ways to potentially stretch your budget.
1. Buy an ex-rental in need of a fix up
You might find you can afford a larger home if you go for one that's in need of some love and DIY. Old fashioned dรฉcor and dated kitchens and bathrooms can easily be improved but many potential buyers are put off by the task, leading to a lower asking price.
There could be a supply of ex-rental homes in tired condition coming on the market as landlords cash in their property portfolios, as well as the usual supply of older properties where the owners have died or gone into care.
Donโt be put off by an ugly or dated property. The only things that you canโt change are the location and the amount of light it gets.
Look for a home in which would benefit from new fixtures and fittings. This way you can live in it while you do the work.
2. Look outside your ideal location
If you canโt afford the home you want in your search area, cast your net wider. Are there other areas nearby with lower house prices? In some towns there are roads that command a premium, while a home around the corner might not โ and being the first into a location that is not quite up-and-coming could see you buying an appreciating asset.
Homes that are in the catchment area of a top state school can sell for a premium, and so can those near a station. But if you don't have kids and work from home - there's no need for you to pay for the extras.
There could be practical reasons why you need to live in a particular location, but if increasing your journey to work by 15 minutes might means getting the home you need, it could be a worthwhile compromise.
3. Get a home you can extend
If you canโt afford a property with the number of bedrooms you want, you could find a smaller home with the potential to extend.
Building an extension is often cheaper than buying a larger property, and its value should potentially rise once the extension is complete. Building an extension is not a DIY job, but a loft conversion, a basement or even a garage conversion may all give you the space you need.
4. Get some government assistance
There are several first-time buyer schemes offered by the government to help you get on the property ladder, and some developers of new-build homes will be keen to help you buy what they have built.
- Shared Ownership is a government scheme that lets you buy a share of a property from a housing association, a non-profit-making body that provides homes. Because you only own a part of the property, you can buy it with a smaller deposit and mortgage - but youโll also pay rent on the share of the property you donโt own. You can gradually increase your stake in the property as and when you can afford to, in a process known as staircasing.
- The Mortgage Guarantee Scheme can help you buy a home with a smaller deposit. It means you only need to save up a 5% deposit to buy a home, as you can borrow the remaining 95% of the propertyโs value. The government guarantees the portion of the loan thatโs over 80% so lenders can afford to be more generous. Some lenders are now offering 95% mortgage outside the scheme until 30th June 2025.
- The First Homes scheme offers first-time buyers discounts of between 30% and 50% on a new-build home. Some councils prioritise giving First Homes discounts to key workers, people who already live in the area and those on lower incomes. You must be able to get a mortgage for at least half the price of the home - which must cost less than ยฃ250,000 - or ยฃ420,000 if you live in London.
5. Call us at Continuum
Thereโs not much we can do to reduce the cost of your home, but there is a lot we can do to help cut the cost of your mortgage.
By finding a mortgage with a longer term, looking at interest-only deals and searching the entire market, the chances are that we can find a mortgage deal that will help put your ideal home in reach.
Donโt compromise. Call us today.
The information contained in this article is based on the opinion of Continuum and does not constitute financial advice or a recommendation to a particular mortgage product and you should seek independent financial advice before embarking on any course of action.
Your home or property may be repossessed if you do not keep up repayments on your mortgage.
https://www.gov.uk/government/publications/the-mortgage-guarantee-scheme
