Eight steps to getting your own shag palace…
“Most important thing you’ll ever do,” says dad, when you tell him you’ve scraped together enough for a deposit on a miniscule studio apartment above the vet’s. Here’s how to buy bricks ’n’ mortar the right way…
Do your sums
Don’t even contemplate buying a place if it’s too expensive – mortgage payments should come to no more than 35% of your salary, say thisismoney.co.uk.
Location, location, location
The single most important thing about any property. View of tramps pissing? Then you’ll never sell it. Good spots to look are ‘up and coming’ areas, places with decent transport links and specific streets given the thumbs up by friends. Selling Houses presenter Andrew Winter recommends taking a peep at upmystreet.com for a free, in-depth profile of the street you’re interested in.
Make an offer
Channel 4’s Kirstie and Phil advise making a very near offer if it seems a good deal and you really want it; if you’re less fussed, offer 10-15% lower than the asking price. The seller can only say no, in which case you can raise your offer a bit, though surprisingly often the desperate chumps say yes.
Get a good mortgage
Look at the lenders’ percentage rates. The higher the rate, the more you’ll pay each month. Generally, the bigger your deposit the better the deals available to you, and the range is dazzling (see Moneysupermarket.com/mortgages). Most mortgages are paid back over 25 years, but you could start off with a fixed-period fixed-rate deal (say, two, three or five years), which guarantees that your monthly payments stay the same for that timescale. An ‘interest only’ option will substantially reduce your outgoings, though at the end of the 25 years you’ll still owe what you paid for your home, although it should have sufficiently increased in value to enable you to sell it, pay off the loan… and downsize to a small shed in Hull.
Get a survey
At £400 or so on a flat, these are a must. The most sleepless nights you’ll ever have can result from buying a flat that’s a dud. Hint: Surveyors will always find a stack of faults. Get yours to say, off the record if necessary, whether or not it’s worth buying.
Find a solicitor
For around a grand, a brief will do all the legal searches necessary for the sale. They’ll also act as a go-between between you and the seller with whom you’ll quickly fall out when they reveal that they’re not including the windows in the sale. On a budget? Do it with legalmove.com, who charge from £189 plus VAT.
It takes around three months from offer to ‘completion’ (the legal term for the transfer of funds/ownership) to allow your bank and solicitor to do their bit. You’ll need to get your new house insured, and you’ll also need to find funds to pay the Stamp Duty (anywhere from 1-4%, depending on purchase price). Ouch.
Move in. Go, “It’s a bit small.” Sell.