Looking to get on the property market? Join the club. The road to owning your first home can be a difficult one, and it’s harder than ever for twenty and thirty-somethings to get on the ladder. It’s difficult, but it’s not impossible.
To take that important first step on the property ladder, get yourself a savings plan on the go. With the following tips. you can experience some of the easiest ways to save money when buying your first home.
Reduce your outgoings
One of the simplest ways to save money towards your deposit is to reduce your outgoings. If you spend too much money on your food shop, gym membership, etc – then it’s time to cut back.
You can adopt some simple ways to save money on your monthly expenses, and all it takes is being smarter with your spending. Take a close look at all of your outgoings and eliminate the problem areas.
Set a budget
Creating a budget is without a doubt one of the easiest ways to save money. Not only does it help you to stick to your plans so that you can save more money, but it will also help you to become more responsible with money. Create a budget that covers off your savings and all of your necessary outgoings, then make sensible decisions about what to do with the rest. You might even find that the extra caution you’re taking with your money means that you save even more of it – helping you to build up your deposit quicker.
Consider moving in with relatives
Saving money for a deposit, in addition to paying rent on a house or flat, is particularly tough. One thing you could consider doing is moving in with some relatives to help you cut your costs. If you’re disciplined with your saving, you could get the money you need together in a matter of months. If moving in with relatives isn’t an option, consider moving to somewhere with cheaper rent to help you grow your savings.
If you moving out isn’t an option, could someone moving in be of help instead? If you’ve got a spare bedroom, bringing in someone who’s willing to split the rent could help to reduce your monthly rental payment. It’ll only be a temporary measure while you get your funds together, and you might even make a new friend because of it!
Take advantage of Help to Buy
First-time buyers can take advantage of the government’s Help to Buy scheme, which allows people to buy their first new-build property with a 5% deposit, while the government loans the other 20%. It’s a great scheme for first-time buyers, and although it means you have to have a new-build property, it could be your best chance to get on the ladder. It’s worth finding out all you the information you need on Help to Buy to help decide if it’s the right scheme for you.
Meanwhile, the government has also introduced Help to Buy ISAs, which allow you to save up to £200 a month and receive 25% on top of your savings. It’s a great way to grow your deposit savings quickly, and unlike the other Help to Buy scheme, you don’t have to buy a new build to qualify. However, the cap on a house price outside of London is £250,000 – which can be an issue with rising house prices. If you choose the Lifetime ISA instead, you could buy a more expensive property, although you’ll have to wait a year to be able to make your withdrawal.
There are pros and cons to both types of scheme, so make sure you do your research to decide if it’s the right move for you.
Think about buying abroad
If you’re concerned about the UK property market, why not consider investing abroad instead? Keep an eye on the latest property news to find out about markets that are doing well and where’s good to invest. You could buy when the rates and prices are good, then sell in a few years to be able to afford a property here. Buying abroad is also a great idea if you’re looking to buy a second home.
Buy in a cheaper area
Another alternative in order to buy in the UK is to buy in a cheaper area. Commuter towns for London, for example, can work out much cheaper to buy than a property in the city, and can even take less time to travel in than from some parts of London. You could always buy a cheaper property as a buy to let in a location where house prices are lower, while still renting a property yourself. Many people do this, particularly those who work in big cities as a fantastic investment opportunity.
Try premium bonds
Want to get the most from your savings with minimal risk? Try Premium Bonds. Premium Bonds allow you to save money each month, with the potential to win money in a monthly prize draw. Prizes range from £1 million to £25. The odds are almost certainly not in your favour, but you can always withdraw the money you’ve put in when you need it.
Make additional savings
If you’re trying to make some extra savings to put more aside for your house deposit, then there are things that you can do to make those savings grow a little each month. Some easy savings tips include:
- Reduce the amount you spend on electricity by switching off all appliances at the mains when they’re not in use.
- Do your grocery shop online to help you stick to a food budget.
- Find discount codes online before you check out – you can save a lot of money each month this way
- Use your car less and either walk or cycle to work as a free and healthy way to travel.
- Cancel memberships for things that you’re not using, or reduce your TV bill if you only watch a handful of the channels.
- Start taking a packed lunch to work to save up to £50 a week!
- Find the cheapest rates for your insurance, phone bill, etc. Making a switch to another provider could save you a lot of money over the course of a year.
- Make money using your receipts with Shoppix
Take advantage of cashback rewards
Are you a member of cashback schemes? Quidco, Topcashback, and several banks offer cashback schemes that reward you as you spend. While the savings can be small with some retailers, renewing mobile phone contracts, insurance policies, etc. can actually help you grow a healthy savings pot. Start using cashback sites whenever you shop online to make sure you’re taking advantage of all the savings that are out there.
Start a side hustle
If your current earnings are preventing you from saving as much as you’d like, then why not start a side hustle? Do you have a talent or skill that you can market on a freelance basis? Give it a try! Other side hustle ideas include teaching, starting a blog, or taking on a casual second job. Side hustles can be an excellent way for you to earn extra money short-term, or it could turn into a profitable new career venture for you.
Saving money is rarely easy, but if you work hard at it, you’ll have your house deposit together in no time. Look for ways to save more and take advantage of the latest trends in the housing market to help you get on the ladder.