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Posted on 02 August 2020

5 Things I Wish I Knew Before Buying My First Home!

Exchange Train met with new home owners Harry and Lauren to discover first hand what its like buying your first home in this current market and what information they wish they knew.

Luckily for us, both Harry and Lauren were happy enough to put their thoughts in writing for us to share!

There is no two ways about it – buying a house is stressful!  Any number of things can appear out of the woodwork when you least expect it.  When my girlfriend and I started looking for a house, it was equal parts exciting and head-scratching, because of all the things we didn’t know and all the tales family and friends told us based on their own experiences.

At the time, two of our friends were also looking for their first home, which made the knowledge sharing amongst ourselves really helpful.  (So, on that basis, if any of your friends are going through their first purchase, or indeed another purchase, I would strongly recommend talking to them over a coffee (or any other drink of your choice) and swap stories!)

1.    How much?!

So, to start, the first thing I wish I knew was how much it costs to get certain work done to a house. Things like; installing new windows or dropping the curb to make a drive, replacing an entire bathroom or rewiring a house.  Obviously what you look into will depend on what type of ‘project’ you want to take on, but I highly recommend putting a few hours in ahead of time to look at different websites to get a feel for the prices in your region.  The advantage here being that you can use the rough estimate to negotiate a price through the estate agent.

2.    What is the ‘ceiling price’?

The next thing I wish I knew was the term ‘ceiling price’.  Essentially it is the highest average price in an area for the type of house you are looking to buy.  This serves as a good benchmark to know if you are paying the right amount for the property.  If you’ve gone for a project or it needs some work, you can use the costs you worked out above to make sure you’re not going to pay to much for the house. Basically, do the maths and don’t overpay.

3.    Freehold vs leasehold

The difference between Freehold and Leasehold is another thing you’ll need to factor in.  We were committed to buying a Freehold property because it means you own it out right but the leaseholds are essentially a borrowed property that you can buy and sell over a period of time before the real owner takes it back. If you do choose a leasehold make sure to check the term (the remaining number of years) on the property. Avoid leasehold where the term is short as this will erode the market value of the property if you want to sell it again. In short, the longer the better.

4.    Surveys, surveys, surveys

I wish I knew about all the types of survey you can get for a property. The three main ones being the valuation survey, Homebuyers report, and a Structural or Full Building survey. Depending on how comfortable you are and the type and state of the property you are looking at will lead you to settling on one of the above.  The valuation survey is usually freely done by the mortgage provider and is a check from the roadside as to the visible state of the property to establish if the estate agent’s valuation is appropriate. The Homebuyers and Building surveys are a lot more investigative and will cost you.  RICS have a very good breakdown of the difference between them and the things you should consider when choosing which survey you want.

What we also found out was that you can also have electrical and gas surveys done on the property as well as further investigation into anything suspect shown in the survey should you choose to have one. These are usually done by a qualified tradesman of your choosing or if you wish the estate agent can make recommendations from their books.  It is also worth noting that if you pay out for any survey you will lose the money if you pull out of the purchase as we found out when we went for our first offer on a different house.

5.    Placing an offer

It sounds simple… and it is, but placing an offer is something nobody tells you how to do.  In short, decide what you are willing to offer, phone the estate agent and make the offer, then the fun starts.

In summary…

The important thing is to enjoy the process! As a first-time buyer you are in a unique position so should use it to your advantage. I hope this has helped a little and good luck on your journey. Please let us know your thoughts via our social media and we will keep posting on the subjects you want to hear about.

 

Harry & Lauren