Owning a home is still possible

Owning a home is still possible

It’s no secret that it can be tough to get on the property ladder, either as a genuine first-time buyer or as someone who’s bought before but gone back to renting for whatever reason, for example, to spend some time abroad.  The good news is that, in spite of all the challenges, it is possible.  Here are some tips to make it happen.

The less you spend on rent the more you can save

This may seem like stating the blindingly obvious but it’s one of the many realities of life which can be a whole lot easier in theory than in practice.  To be perfectly blunt, putting together the deposit you will need to buy a home of your own is likely to be a lot easier if you are prepared to make compromises on where you live in the present.  Living with your parents may be the ultimate example of this (their house, their rules) but this is not necessarily a practical option for everyone.

For those living away from home, making compromises may involve choosing a smaller space over a bigger one, accepting a longer commute, or choosing a less-desirable area over a more chic one.  Obviously, all of these options have to be subject to the common-sense test.  There is a limit to how small a space a person can reasonably live in for an extended period of time and there is no point in choosing to live in a place where the housing is affordable but the commute is long if it means that you are just swapping housing costs for commuting costs (and time) and you clearly want to avoid living in a place which is actively unsafe.  All the same, however, all things being equal, you should probably give preference to the place with the lowest housing costs as rent is typically a substantial expense and hence anything you can do to reduce it can make a real difference to how quickly you can save for a deposit.

Always look for ways to increase your income

The nature of your employment will largely determine how feasible it is for you to earn extra money in your main job, but if you’re in a position where you get a fixed salary for (officially) fixed hours and have little scope to earn extra on top and you’d prefer to stay in that job, at least for the foreseeable future, then you can still look for other ways to earn extra money.  Getting a second job can bring all kinds of complications (including your current employer being unhappy about it, you new employer making requests which conflict with your main job and your tax being messed up, although this last should not happen), but there is nothing to stop you setting yourself up as self-employed and building your own little side-hustle.  Just remember that you will need to register as self-employed and pay taxes on whatever you earn.

Take care of your credit rating

If you’ve saved and worked to put together a solid deposit, it would be heartbreaking to be turned down for a mortgage because of silly mistakes such as going over the limit on a credit card or missing a payment.  Standard advice here is to put all payments on Direct Debit so that you never miss one, however, there is an alternative approach, which may save you a little money, at the expense of some organization.  Put as many payments as you can on manual and pay them the moment you have the money to do so, for example on payday or when you get your earnings from your side hustle (remember to set aside money for taxes).  This will minimize the interest you pay.

Your property may be repossessed if you do not keep up repayments on your mortgage.


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