Owning a property is something that many people strive to achieve. The freedom of being able to make a place your own, while adding personal touches and settling down is a wonderful experience. Although, in recent years, properties have become increasingly expensive and salaries haven’t necessarily risen with them.
Combining these two issues with high rents has left a generation of people struggling to buy property until much later in life, or possibly not at all. However, not all hope is lost! It might take some discipline and determination, but there are ways you can save up more easily in order to make a deposit on your first home.
1. Get a Separate Savings Account
If you’re trying to save money — for anything — it’s worth opening a separate bank account to place that money in. If money is sitting in your current account, it’s far too easy to spend it. Before you know it, you’re broke again waiting for the next payday! You can open another current account, but having one that is specific to savings is best. Separating your money this way makes it a lot easier to start building up your cash pile, and prevents you from accidentally spending too much out of your paycheque.
2. ISA Account
There was a time when the government was running a ‘Help to Buy’ ISA scheme, which was specifically designed for people wanting to buy their first home. Unfortunately, these are no longer available. However, opening a normal ISA savings account could still be a viable way for you to save for a new home. Unlike regular savings accounts, ISA’s don’t get taxed on the interest you earn.
3. Shared Ownership
This might not be for everyone, but it’s definitely worth considering. Shared ownership is an opportunity for you to pay part of the price on a flat or house, and pay the rest of it off through rent. This is a particularly useful way of getting on the property ladder for those with low incomes. However, there are certain restrictions around shared ownership schemes, so make sure you do your research first.
4. Make Realistic Choices
What’s your dream house? A picturesque cottage with a thatched roof and roses up the wall? A mansion in the wealthy suburbs of London? It would be incredible if you had the kind of money to purchase your dream home first time around, but it’s unlikely. It’s important that whatever kind of property you buy, it is one that you are happy with. But you should have sensible expectations as to what will be on offer in your price range.
5. Research Mortgages
For the majority of people, a mortgage is necessary to purchase a property. Different providers will have varying rates and requirements for applicants. Don’t rush into anything; use comparison sites or meet with a mortgage broker to find the best deal for you.
Getting on the property ladder can be tough, but these 5 tips can help you on the way to buying your first home.