First Time Buyer Tips on Saving for a Deposit
These days saving up for a deposit as a first time buyer to put down on a property can seem like an insurmountable struggle. And yes, we do sympathise. However, there are ways and means to make it that little bit easier so that you don’t have to starve yourself or become a hermit in the process.
How so? Well, here are a few tips from some savvy first time buyers we’ve been chatting to recently – ones who didn’t have to save for the 20 to 30 per cent deposits the high street lending institutions were asking for.
Help to Buy: ISA
It’s hardly a government handout, but the Help to Buy ISA is a case of money-for-nothing in the sense that you don’t have to pay it back. And this scheme really can improve matters – especially if you’re a first time buyer couple saving for the same property (since you can jointly benefit from the initiative).
So what is it? Well, it’s really a top up to what you’ve already saved in your ISA. Invest £200 a month, for instance, and the government will give you £50 to put towards that. The most you can save in the account is £12,000 – you’ll then get a £3000 from the government to put towards a deposit (and which your solicitor will apply for when you come to buy).
The majority of high street lenders, such as Virgin and NatWest have signed up for the scheme. Do shop around though, since interest rates can vary by as much as one per cent.
We particularly like this scheme because, unlike Help to Buy, there’s no restriction on the type of property ie you can put the money towards a new build, Victorian semi – whatever you fancy, in fact.
The scheme is due to end next year but we’re guessing it’ll be replaced by something similar for first time buyers and you’ll be able to transfer the money you’ve already saved over.
Make some lifestyle changes
Sometimes the smallest changes can make the biggest difference. You know that old adage about saving the pennies and the pounds looking after themselves? Well, it does work. And it’s not too bad if you know your scrimping is for a particular purpose – and a very good one at that. Here’s some ways we’ve managed to cut back and save cash in the past:
- Aim for those supermarket reduced sections. Those Best Before dates are just that – and not when the food is past its prime
- And once you’ve bought all those reduced vegetables and meat (if you’re carnivorous), make it into delicious stews and curries then batch freeze it – which will also save you loads of time during the week when you don’t have to cook from scratch
- Another great way to save in supermarkets is to buy unbranded goods – you’ll get used to the different tastes after a while, we promise
- You know how you’ve always wanted to be fitter but never seem to have the time? Well, how about cycling to work on a second hand bike if possible? You’ll feel better for it too!
- It can seem a bit of a chore at first, but once you get into the swing of changing utility providers every year (or even every six months if you spot a great deal), it can seem like routine. And you can save hundreds of pounds a year this way – surely a big incentive in itself!
Thinking of buying your first property but not sure of all the ins and outs of the property market? If you’re hoping to move into the Woolwich or Peckham areas and surrounds then come in and see for a chat here at www.jtclarkelondon.com. You could always call and make an appointment with one of our team on 020 7277 6699. We’ll even make you a coffee…