Tips for First-Time Buyer's

Owning your own home does bring with it the extra security and freedom however buying may not necessarily be the best option available for you. If you are in any doubt that buying a house is the best thing for you to do, think very long and very hard before making a final decision. The decision to buy a house can only be decided based on your individual circumstances and your plans for future. Once you have decided that buying is the right decision, it is then important to plan your purchase.

Think about what you can afford. Remember to take into account the other costs you will incur apart from a mortgage loan, i.e. the deposit on your new home, the cost of any surveys, your solicitor's fees, stamp duty as well as your normal outgoings. It is your first home so you may need to buy a lot of house furniture and kitchen appliances also. Also be realistic about your monthly outgoings.

With the property prices soaring it may seem impossible for a first time buyer to buy a property however there are some home ownership schemes available which can help you towards cost of buying a property

• Right to buy- This is for council tenants who may have the right to buy the council house they live in. However, being a council tenant does not mean you have automatic right to buy, you have to meet certain criteria to be eligible for this scheme. Please get advice to know if you are eligible for this and about payments and discounts available.
• Right to acquire - This is similar to the Right to Buy but is applicable housing association tenant however the discounts are much lower and fewer properties qualify. If you used to be a council tenant but your home has been transferred from the council to a housing association, get advice. You may still have the right to buy with the same conditions as a council tenant.
• Shared Ownership- Shared ownership schemes allow you to buy a share of a property while the rest is owned by a housing association. You pay a mortgage on the share you own, and rent on the rest. You can buy more shares later on if you wish, and may eventually be able to afford to buy the whole property.
• Home buy- This scheme lends you 25% of the purchase price. You use a mortgage and/or savings to pay the remaining 75%. You don't have to pay anything towards the loan until the property is sold, but you can if you want to. When you sell the property, the housing association will take 25% of the sale price (or less, if you have already repaid part of the loan). These are very limited offer and mainly open to council or housing association tenants.
• Cash Incentive Schemes- Some local councils and housing associations also operate cash incentive schemes to help their tenants buy a property on the open market. Cash incentive schemes are only available in some areas, and the number of loans is limited.
• Starter homes initiative (Key worker home buy) - The starter homes initiative is aimed at teachers, the police, nurses and some other health workers. It is only available to first time buyers. It can help you to buy a home near the community where you work if property prices in the area are very high. Other key workers (such as social workers, care workers or the fire service) may be eligible in some areas

Home ownership schemes are usually run by housing associations or the local council. You can get information about schemes in your area from your local council, a housing aid centre, a citizen's advice bureau or other advice centre

Buying a house with your friend or partner or spouse gives you the advantage of buying a bigger and possibly better home in the area of your choice. However, it's always advisable to rent together first for at least six months first; if there are too many disagreements, it's much easier to walk away from a tenancy agreement than a joint mortgage.

No matter how well you get on with your co-owner, there are risks to be considered. If one of you can't meet your obligations, it will fall upon the other(s) to make up the balance of mortgage payments. You must also consider what you'd do if either of you couldn't work due to illness, lost their job, wanted to move out, or died. A legal contract covering any eventuality may save all involved a lot of stress and money at a later date if the relationship changes. Do get good and clear advice on below areas before you buy the property

• Legal Ownership
• Financial Shares

If these are not clearly defined and you and your co-owner are splitting up then in all probability you may have to go to court to settle matters.

Before you go house-hunting, it is important that you know your budget. A mortgage is primarily calculated on your gross income. You will have to provide documents supporting your gross income such as payslips, letter of reference from your employer or accountant if self-employed, etc… All lenders will look primarily into your gross income however how much money they will lend varies quite a lot from one lender to another. Generally, if its to an individual then its around three to three and half times salary and to a couple its generally lower. However though most lenders stick to this equation quite rigidly there is room for negotiating and the introduction of using an affordability rate is also creates lot of variation. So its best to shop around and contact the various lenders to ensure you get the best loan as desired by you. It is worth getting pre-qualified mortgage as this will give you an upper hand with the seller also ensure you know your budget more accurately while searching for your home.

The next step is to create a realistic idea of the property you'd like to buy. What features are most important to you? Make two lists: one of the items you can't live without and one of the features you would enjoy. Refine the lists as you house hunt. Also register with your local estate agent who can then show you house that meet your expectations come up in market. Also think carefully and ask yourself as to which area would suit your best and what kind of a property are you looking for. Answering these questions will ensure that more focused and successful your purchase will be.

Once you have decided on the basics such as your budget, size and kind of property, area you can now start to visit houses. Keep track of the properties you've seen. After touring each home, write down what you liked and didn't like. Develop a rating system that will help narrow the field down. For example, pick the house you like best on day one and compare all other houses to it. When you find a better one, use the new favorite as the standard. Make a questionnaire which you can ask to owners/agents with regards to the property, local area and amenities etc… If you think you have found something you like, ask to go and have a look at the place again, but without the pressure of the estate agent with you. This way you can take your time and view with a clear head. Try to picture the place with all your possessions in it and refer back to your notes on your ideal home. If you are sure you have found the right place then go ahead and make the offer.

Before you make an offer, study the location carefully and know the property prices around that area. Negotiations are part of the process and estate agents mark up the price at times to get true price. The first offer is usually 5%-10% below the asking price, depending on the perceived level of demand and current market conditions. The two sides then work towards some common ground with further offers and reductions in asking price. It is very rare for you to get your opening offer accepted, however close to the asking price it is. Both the owner and the agent will expect you to negotiate. Don't lose out on the house of your dreams purely through stubbornness over the final couple of percent of the asking price. Make sure the offer is subject to a survey and contract. If the survey shows up something that needs doing on the property, don't be afraid to renegotiate. Insist that the vendor takes the house off the market immediately to discourage any further offers and reduce the risk of you being gazumped (other buyer outbidding you after you have put in your offer)

After your offer is accepted, set up a home inspection. It's common to find problems, including leaky roofs, cracked walls, insect infestations and foundation problems. Your real estate professional can help find a reputable inspector, and will negotiate to get you the most for your money once the inspector's report is final. If you negotiate repairs as part of the purchase, ask for a; "walk through" before finalizing the paperwork. Ask your real estate expert about home protection plans, which may save you money in the near future.

Costs of the owning a house does not end with just the payment of the house. There will be your monthly utilities which if originally were covered in your rent, this may be new for you. In addition, you'll definitely have property taxes, and you will have council taxes. You should also have home insurance, ensure you have list of handymen as house will require regular maintenance and also keep some money aside for those emergencies such as unscheduled boiler maintenance, plumbing etc…

Once you have finished all the paper work, all contracts exchanged consider some moving basics: arranging alarm company, change of address in banks, post, etc… confirming and reconfirming removal services, and completing any re-decorating in your new home. The best time for renovations is often before you move in…