First-time buyers: 8 top house-buying questions answered

Buying your first home is an exciting process, but it can also be worrying, so St. Modwen’s Homes offers 8 top house-buying answers to questions for first-time buyers.

Buying your first house is an exciting process. You get to choose a community to settle into, find design inspiration, and organise your belongings ready for moving day. But with the excitement also comes a lot of questions. After all, buying a house is a big leap forward in life.

Are your queries and concerns holding you back from taking this significant step? Now, new research has revealed our most asked questions on Google, digging deep into the topics that homebuyers are searching for the most.

The data reveals key concerns that new homebuyers have and how important they are. Reviewing the searches, here, we reveal homebuyers’ most frequently asked questions.

8. Should I get a fixer-upper?

200 people ask Google every month whether a fixer-upper is worth it. The answer, of course, depends on your tastes. However, you have more options than just a fixer-upper – there’s no reason that you can’t put your own spin on a new-build home.

According to Checkatrade, the average price for renovating a three-bedroom house is about £38,000 to £74,000. So, if you buy an older house, you can expect to pay a little more on top of the purchase price. Costs may include new gas supplies, rewiring, or getting your house up to good EPC standards.

New-build homes, on the other hand, are a complete blank canvas and also offer the ability to upgrade and change aspects of the house. From the kitchen to the garden and everything in between, you can choose certain design aspects and products for your home. Sustainable options, such as electric car charging ports, UV panels, and wastewater heat recovery systems, can also boost your environmental standing. These are upgrades that may be difficult to add to an older fixer-upper.

7. Is renting cheaper than buying?

If you’re renting your home or apartment, buying a house can be a big change. It takes financial organisation, and you’ll become liable for your own repairs and utilities. In 2020, 4.44 million households were occupied by private renters in England. But is renting your home cheaper than buying one? Every month, 300 people in the UK ask this question on Google.

The answer, according to a recent report, is no. Homeowners are better off than renters by more than £800 per year, according to Halifax. Buying your home should be an investment, and with £800 savings per year, the financial benefits are clear.

6. Do I need an estate agent?

Every month, 690 people ask if they need an estate agent to buy a house. However, you don’t need an estate agent to buy a house. Homebuyers do not pay estate agent fees, but sellers do. So, if you’re just buying your home, whether it’s a new-build or older, you will not need to find an estate agent.

5. When should I apply for a mortgage?

Preparation is key when applying for a mortgage. You need to get your finances in good order and understand the type of mortgage you need. As with any preparation you do, the sooner you start this, the better. There are 1,090 searches asking when to apply for a mortgage every month.

You can’t complete a mortgage application until you’ve found the house you are buying, but you may be able to get a mortgage in principle. This is a written estimate from a mortgage lender giving you an indication of how much money you can borrow. In turn, it can make the mortgage process quicker when you do find a house.

4. Do I need a good credit score?

The higher your credit score, the better. There are 1,290 searches per month asking this question. Buyers should aim to have a good credit score before they apply for their mortgage, as it suggests that they are reliable. It can also help reduce interest rates on the loan.

3. Is now the time to buy?

If you’re wondering if, now is the right time to buy, you’re not alone. Every month there are 3,240 searches for the topic. The answer can depend on individual circumstances; the real question is whether you are ready to buy.

While interest rates are currently low, now could be the best time to complete the purchase of your new home. However, jumping into a mortgage too quickly can be not so beneficial. Low deposits can lead to high interest rates that cost you in the long run.

Ultimately, if you’re financially ready and prepared to buy a house, then now may be the best time for you. If not, there’s no harm in waiting a little longer. Aim to save as much money as possible, as it will only save you more in the future.

2. How much should I spend?

Following up on the question ‘How much do I need?’, Googlers asked ‘How much should I spend?’ 4,970 times per month. Understanding the value of the house you can afford is essential when applying for a mortgage. A deposit alone is not enough to get a mortgage. Banks will consider a range of factors, including credit score and salary.

Banks may lend up to about four times your annual salary. However, you should also consider what you can afford to repay on your mortgage. Using a mortgage calculator is a good way to see if you can afford to buy your first home.

1. How much do I need?

There’s more to buying a house than getting a mortgage. How much you need before you buy your home is the number one topic asked by prospective homebuyers in the UK, with 22,270 monthly searches. While the total upfront cost can vary from home to home and buyer to buyer, we can help set your expectations for upfront costs.

The average house price for a first-time buyer in the UK for 2021 is £256,057. So, if you’re the average first-time buyer, we can make a small prediction of costs.

Let’s say you’re buying a home for £200,000. As a first-time buyer, you could apply for a 95 per cent LTV mortgage, meaning that you only need a £10,000 deposit. Alternatively, the Help to Buy: Equity Loan is another option. First-time buyers can purchase a new home with just a five per cent deposit when using this scheme. You’ll then be able to borrow up to 20 per cent (or 40 per cent in London) of the purchase price from the government through an equity loan. Even better, there’s no interest on that loan for the first five years. You can work out how much you’ll need to save and how much you can potentially borrow by using a Help to Buy: Equity Loan calculator.

There may also be other costs, including mortgage fees and moving costs. You may want to set aside up to £3,000 for these.

These are just the minimum figures involved in buying a house. However, it’s always best to save as much as possible, as increasing your deposit helps reduce costs in the long run.

Buying a new house or your first home doesn’t have to be complicated. Of course, the experience can be daunting and there are big questions that need answering. But preparedness is key when purchasing a property and recognising that other people are searching for these topics means that you’re thinking about the right things.

The key thing to remember: never be afraid to ask questions. Mortgage advisors, homebuilders, friends, and family will always be on hand to help.

Sources:

https://www.statista.com/statistics/286444/england-number-of-private-rented-households/

https://www.which.co.uk/news/2021/04/is-it-cheaper-to-own-or-rent-a-home/

https://www.gov.uk/stamp-duty-land-tax

https://www.statista.com/statistics/557882/first-time-buyer-average-house-price-by-region-uk/

https://stmodwenhomes.co.uk/ways-to-buy/help-to-buy/

https://www.checkatrade.com/blog/cost-guides/cost-renovating-house/

Kindly shared by St. Modwen Homes

Main photo courtesy of Pixabay