Getting a mortgage is a serious commitment, and buying property is often rife with unforeseen costs, no matter how carefully you plan. But the rewards of owning your own place can make it all worthwhile.
In this guide, we explain:
Before making a major financial decision like buying property, it's worth stopping to ask yourself if you have all the necessary information.
These questions can help you work out how ready you are to buy a home:
What's happening to house prices?
For obvious reasons it's better if your property increases, rather than decreases, in value after you've bought it. Unfortunately, the market can be hard to predict with markets sometimes behaving differently street by street.
Ideally, you should try to buy at a time when prices are low but showing signs of rising. Talk to local estate agents and look at sold prices on the Land Registry website to get an idea of what's happening in your area.
Find out more: How much is your house worth? - Use the interactive map on this page to find out what's been happening to property prices in the area that you want to buy in.
How will a lender view my employment situation?
Mortgage providers require proof of your income to decide whether and how much to lend to you.
Some lenders will only give mortgages to people in permanent jobs, so if you’re self-employed or on a fixed-term contract, getting a mortgage may be more difficult - though not impossible.
Find out more: How to get a mortgage if you're self-employed
Do I have a good credit history?
A good credit history is key to a successful mortgage application. This can be a problem if you’ve never taken out any credit.
One step that everyone should take is registering on the electoral roll, but you could also take out a credit card and pay it off in full each month.
Find out more: How to improve your credit rating – expert advice on building up your credit score
Have I saved up a decent deposit?
First-time buyers can borrow property with a deposit as small as 5% of the property value - but if you have a larger deposit, you'll have access to better mortgage deals and cheaper rates.
Liftetime Isas and Help to Buy Isas are specifically designed for first-time buyers. If you save into a Lifetime Isa, for example, you'll earn a bonus of 25% from the government on your savings (up to a maximum of £4,000 a year).
Find out more: How much deposit do I need for a mortgage?
Could a government scheme help me buy sooner?
If saving a decent deposit seems like a distant dream, schemes such as the Help to Buy equity loan could help you buy property more quickly.
Under Help to Buy, the government will provide you with a 20% equity loan towards your first home, enabling you to put down a much larger deposit.
Find out more: What is Help to Buy?
How much can I borrow?
Before you set off house-hunting, you need to have a budget in mind.
How much you can borrow from a bank will depend on your income, your credit history and the size of your deposit. If you're buying with another person, the bank will also take their circumstances into account.
You can use our calculator to work out how much the bank is likely to lend you.
Find out more: How much can I borrow?
Will I be able to afford the repayments?
The numbers involved with buying a house are so big it can be hard to understand what they'll actually mean for your everyday finances. When you're looking at mortgages, work out what your monthly repayments will be – and how they'd change if interest rates went up.
Find out more: Mortgage repayment calculator
How much will my monthly bills cost?
If you’ve been renting from a decent landlord, you won’t have had to worry about the costs of major repairs and maintaining appliances.
But when you own your own home, all this will be your responsibility, and it's important to set money aside for unforeseen costs such as repairing a leaky roof.
Find out more: What household bills will I pay as a homeowner?
What extra buying costs do I need to factor in?
Your mortgage deposit is just the start: buying a house or flat is extremely expensive.
Find out more: The cost of buying a house
First-time buyer videos: things I wish I'd known
In the videos below, first-time buyers share what they wish they'd known before buying their properties and give tips on how you can avoid the problems they faced.
Next steps to becoming a homeowner
While owning a home can be wonderful, the buying process is expensive, stressful and time-consuming.
Home ownership isn't for everyone, and you shouldn't feel pressured into buying a property – only do it if you really feel ready for the commitment and plan to stay put for at least five years once you've taken the plunge in order to make the expenditure worthwhile.
Once you're ready to take the plunge, our guide to buying a home can help you understand the next steps.
- If you do think you're ready to become a homeowner, we'd recommend calling Which? Mortgage Advisers on 0800 197 8461 to find out how much you might be able to borrow. The team of friendly, impartial advisers can help you work out the best mortgage and deposit options based on your personal circumstances.
Correct as of date of publication.