Top Ten Tips When Buying A House
27 Jun 2019
1. Beware of Brexit:
Even before prices fall - if indeed they will - experts are already saying that it’s a buyers-market out there. So if you plan to live in your new home for the foreseeable, now’s a good time to buy. If you’re buying to renovate and flip for profit, then maybe hold off until the Brexit dust settles.
2. Research the area PROPERLY
Taking a tour of the neighbourhood is a good way to get a snapshot of what your new life could look like, but don’t let the area’s beauty (or otherwise) cloud your judgement.
It’s also worth checking the government's planning portal for new building works in the area. After all, there’s nothing worse than having your new view blocked by a power plant or stadium, right?
3. When viewing come prepared
Charging in all-guns-blazing might help you get a gut feel for the property, but it takes a cooler, more methodical approach to really size the place up.
In isolation, no one problem needs to be a dealbreaker. But issues cost money and you have to square said costs against your budget. Failing to think about future problems and expense could be the difference between snapping up a dream home or buying yourself a living nightmare.
When viewing, check the place thoroughly.
4. Get ready for a fight
When it’s time to put in an offer, work out an accurate upper limit that you can honestly afford and DON’T GO OVER IT. Make a good solid offer, don’t try and be cute and cheap out. If you love the place, chances are someone else does too - and they’re prepared to pay at least market rate.
If a home is listed as ‘offers over...’ (very common in the Scottish property market - more later) then be assured that you will pay over the asking price. Often significantly so.
Don’t bankrupt yourself, but don’t cheap out either.
5. Shop around for mortgages
A wildcard bit of advice - in the tech-era there are several start-ups and disruptors offering non-traditional mortgage products. So definitely do your research and keep your ear close to the ground … without taking unnecessary risks.
6. Get a big enough deposit together
But in most cases it really is, if possible, best to gather as much deposit cash as you can. The average is about 20%. It’s a whack to be paying up front but putting over a big deposit will reduce your monthly repayments and probably improve your mortgage rate. Always get advice, but rule of thumb - more deposit = better.
7. Get Life Insurance
Whilst it's not mandatory, it's probably something you SHOULD have, in our opinion. But don’t feel pressured to take what they’re offering at the outset. As with any long-term commitment, shop around for life insurance and get the product that’s right for you.
This is the bit where we suggest you come to LifeSearch - we’ll do the shopping around/ hard bit for you; match you to products that best fit your circumstances as a whole, not just your need to satisfy a mortgage criteria.
8. Beware of ‘Offers over’
This is more relevant in Scotland, but if a house is listed at ‘offers over £100,000’ for example, and is eventually sold for £110,000, then the extra £10k isn’t mortgageable. It MUST be paid in full, up-front.
To avoid nasty surprises, sit down and methodically work out a bid based on your available funds. Remember - if you bid £110k on a £100k property, and the second highest bid was £105k, then you have just sacrificed £5k needlessly, when an extra quid would have done it.
Take advice, watch how the local market performs and add some logic to any guesstimates, balancing what you can pay with what you think a place will ultimately sell for.
9. Get your legal costs under control
Fees can vary depending on which solicitor you use, but typically come in at around £800 - £1500 per transaction - or more!.
This mightn’t seem like a lot, but after you pump all your savings into a deposit, you might find yourself struggling to cover the mountain of add-ons that come after.
As if you didn’t know - lawyers don’t work for free. So make provisions and factor extra fees it into your finances.
10. Home Insurance?
According to AXA, the average claim for a burst pipe is £25,000. Twenty five thousand pounds.
With insurance this isn’t much of a sweat. Without … well, that doesn’t bare thinking about. So get cover sorted early doors. The comparatively minor monthly premiums will pay for themselves if and when you make your first major claim.