First Time Buyer Saving Advice

dcrdev

Hello

First time posting here and looking for some advice on how much I need to save in order to buy my first house - I've been looking at the government help to buy scheme and that seems like an option for me; I think I've largely got my head around it but could use some thoughts.

I'm currently renting an apartment in the city and am looking to to relocate to the outskirts for a bit more peace and quiet. In my area a three bedroom house in a reasonably nice area starts at around £160k. Factoring in the help to buy contribution of 20% that comes down to £128k, my salary is currently £25k and based on the maximum 4.5x salary a lender would give me I'd need need to raise a deposit of roughly £16k; which represents 10%.

Then there are the costs associated with buying a house i.e. solicitors fees, stamp duty etc... These I'm not really clear on, but have read that these can go up to £6k for the first time buyer. So all in all I'd probably need about £22k in the bank...

Can anyone chime in, am I under/overestimating how much I would need to save?

foxy-stoat

Legals wont be more than £1500
Stamp duty £700
Insurance and moving costs £500
Just look at the lease and ground rent and sinking funds of your buying a flat.

hazyjo

Survey/valuation - up to around £500 depending on which you go for.


Mortgage costs - can be nothing, can be four figures. Play around with some calculators (YBS do a good one) to see what products are available and what their associated costs would be.


There are small costs like bank fees for money transfers (£30 or so I think from memory).


You may also decide to get people in to look at things like electrics which would come out of your pocket if they charge for an inspection.


That's about all I can remember...


Jx

System

Take advantage of the Lifetime ISA (April 17). Use and abuse tax payer's money

dcrdev

Thanks all!

foxy-stoat wrote: »

Legals wont be more than £1500
Stamp duty £700
Insurance and moving costs £500
Just look at the lease and ground rent and sinking funds of your buying a flat.

Fortunately because I work for a law firm I'll get free conveyancing and legal services so that shouldn't be a problem. I would have thought that insurance and stamp duty would be more?

hazyjo wrote: »

Survey/valuation - up to around £500 depending on which you go for.


Mortgage costs - can be nothing, can be four figures. Play around with some calculators (YBS do a good one) to see what products are available and what their associated costs would be.


There are small costs like bank fees for money transfers (£30 or so I think from memory).


You may also decide to get people in to look at things like electrics which would come out of your pocket if they charge for an inspection.


That's about all I can remember...


Jx

I'm not sure what kind of inspection I would need (if any) given that I'll need to buy a new house to qualify for the help to buy scheme?

mrlegend123 wrote: »

Take advantage of the Lifetime ISA (April 17). Use and abuse tax payer's money

Thanks I wasn't aware of that one - I was going to go for a Help to Buy ISA, but this seems like a massively better option.

hazyjo

dcrdev wrote: »

Thanks all!


I'm not sure what kind of inspection I would need (if any) given that I'll need to buy a new house to qualify for the help to buy scheme?

Ah, that's different then


Know nothing about the schemes out there at the mo and who benefits and what the restrictions are or who gives you what money so will bail on that side of it!


Search the forum for HTB scheme (and in full) as there's been lots of mentions recently. Bound to be helpful - and I'm guessing there will be several negatives if it's new builds only.


Jx

wjr4

dcrdev wrote: »

Thanks I wasn't aware of that one - I was going to go for a Help to Buy ISA, but this seems like a massively better option.

When are you planning to buy as you have to hold the Lifetime ISA for at least a year before buying a house. In the meantime a help to buy ISA is the best way to start.. good luck!

dcrdev

It's going to be a little while yet given that saving pretty much begins now - around 18 months I would estimate.

wjr4

dcrdev wrote: »

It's going to be a little while yet given that saving pretty much begins now - around 18 months I would estimate.

http://blog.moneysavingexpert.com/2016/07/25/24984/

If you plan to buy before April 2018, help to buy ISA is best - because of having to keep the LISA for at least a year before using it towards a house .. very helpful article!

Bigrachel

HI,

Make sure you consider your deposit (10% of the property value is a good start) conveyancing fees (£1000+ including disbursements) make sure you get a proper survey! A homebuyer report or building survey depending on the age of the property will set you back £400-600. Removal company will be another few hundred pounds. Also all of the furnishings if you need them. £12000 should do it if that kind of money is possible. That's without stamp duty as well!