The last 12 months have seen the property market slow right down in many areas of the UK, with some areas seeing year-on-year price drops.
It seems that, for now at least, the days of fierce competition, frenetic bidding wars and last-minute gazumping are over. And, with some industry experts predicting that Brexit could cause house prices to fall further, it could make financial sense to buy your first home in 2019.
So, if getting on the property ladder is your number-one new year’s resolution, read on for our step-by-step guide to the home-buying process, plus useful calculators and links to further information.
- If you’d like advice on any of the financial aspects of buying a home, from saving a deposit to getting a mortgage, call Which? Mortgage Advisers free on 0800 197 8461.
1. Save enough deposit
If you haven’t, and you want to buy in the next few months, it’s worth opening a Help to Buy Isa before they’re withdrawn from the market in November 2019. Otherwise, you could opt for a lifetime Isa, but you need to have saved for at least a year to benefit from the bonus.
Nearly all mortgage lenders require you to have a deposit of at least 5%. You can use the calculator below to work out how long it will take you to reach that amount – it will automatically load the average property price for your area, but you can play around with that if you think you’ll buy somewhere cheaper.
- Find out more: how much deposit do you need for a mortgage?
2. Investigate mortgages
A mortgage is a home loan which you pay off gradually each month over the course of a set number of years (known as the mortgage ‘term’).
Most mortgage lenders will offer you a maximum of between 3 and 4.5 times the combined annual incomes of you and any other people you’re buying with.
The mortgage borrowing calculator below will give you a rough guide to the amount you could borrow, but other factors – especially your credit history – will affect this. To find out exactly how much you can borrow, talk to a mortgage broker such as Which? Mortgage Advisers (0800 197 8461).
Before you start house-hunting, it can sometimes be worth applying for a mortgage agreement in principle (AIP) – a document from a lender confirming that they would, in principle, be willing to lend you a certain amount. You can show your AIP to estate agents to prove your budget and that you’re a serious buyer.
Can’t borrow enough?
It could be worth investigating schemes such as Help to Buy equity loans, where the government lends you money towards a new-build property, or shared ownership, where you buy a share in a property and pay rent on the rest.
3. Research the area
If you don’t already live in the area you’re thinking of buying in, try and stay there for a couple of nights to see it’s definitely somewhere you’d want to live.
Test your commute and check out what the atmosphere and noise levels are like at different times of day and night.
If you’re buying in England, the area comparison tool below lets you compare the area you’re interested in with the national average or another town.
- Find out more: finding the best places to live
4. Start house hunting
For many people, the hunt begins with setting up search alerts on a portal such as Rightmove. But while this is a sensible place to start, it shouldn’t be where your research stops.
You’ll need to register with estate agents and start going on real-life viewings to really get a feel for the types of homes available for your budget.
Make sure you talk to the agents when you register with them, as they’ll be able to give you an inside view on what’s been happening to property prices in the local area and whether there are any bargains to be had.
Download our property-viewing checklist and take it with you on viewings to make sure you don’t miss any important details. If you’re considering buying a new build, check out our guide to viewing a show home to avoid being taken in by sales tactics.
5. Make an offer
When you’ve found a property you’re confident you can afford and be happy in, it’s time to make an offer.
Some areas have seen intense competition between buyers over the past few years. However, markets in many parts of the UK have cooled over the last few months and 2019 certainly looks like more of a buyer’s market, meaning it might be easier to pay under the asking price.
This won’t be the case across the board, though, and several factors should affect your decision on how much to offer.
Our guide on making an offer on a property explains what to think about and how to negotiate if your offer is turned down.
6. Apply for a mortgage
Once you’ve had an offer accepted, you’ll need to apply for a mortgage.
Even experienced home-movers often use a mortgage broker to help them with this as it can be so complicated working out which is the best deal. A broker will also be able to tell you which lenders are most likely to accept you, and where you’re likely to be able to borrow the most money from.
To work out how much a mortgage would cost you each month, use our mortgage repayments calculator.
- For friendly, expert advice on mortgages, you can talk to Which? Mortgage Advisers on 0800 197 8461.
7. Sort out a survey and conveyancer
Even if the house you’re buying looks to be in good nick, you should always have a professional survey done to pick up any potential issues with the property.
You’ll also need to hire a conveyancer or property solicitor to do all the legal work involved with your purchase.
They will also sort out your stamp duty land tax, if you need to pay any; the rules for first-time buyers differ depending on where in the UK you live. To see how much you’ll pay, use the stamp duty calculator below.
8. Arrange removals and insurance
As moving day approaches, you’ll need to arrange a removals company to shift your belongings to your new home.
Get a few quotes and make sure you choose a firm that has good reviews. Alternatively, Which? Trusted Traders can help you find a reputable firm.
You will also need to have buildings insurance in place on your new home from the day you exchange contracts. Check out our home insurance reviews to find out which provider is most highly rated by its customers.
9. Exchange contracts
On the day of exchange, your and the seller’s solicitors will exchange contracts confirming that you will buy the property.
You’ll also pay an exchange deposit, which is typically 10% of the property price, but can usually be negotiated down if you only have 5% saved up.
This is a momentous stage of the home-buying process, as it’s the point at which your purchase becomes legally binding and the sale is very likely to go ahead.
- Find out more: what happens at exchange and completion?
10. Complete and move in
On the day of completion, which is typically two weeks after you exchange, the remaining money is paid and you can collect the keys to your new home.
It’s usually a whirlwind of a day so make sure you download our home-moving checklist so you don’t forget anything.
Once you’re in, you can start unpacking – and of course raise a toast to your huge achievement.
Get personal advice on buying your first home
No matter what stage of the home-buying journey you’re at, from starting to save a deposit to being ready to apply for a mortgage, you can call Which? Mortgage Advisers for a free chat on 0800 197 8461.
There’s no such thing as a silly question and the friendly team will be happy to help.
Alternatively, you can fill in the form below for a free call back.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Which? Limited is an Introducer Appointed Representative of Which? Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited.