It’s one of life’s biggest milestones; collecting the keys to your first home. Little else is as exciting as stepping over the threshold and knowing that what you’ve worked so hard for is finally yours to put your stamp on.
If you’re anything like the typical first time buyer we work with, you’ll have spent hours trawling property listings across the board, until you have curated the perfect checklist for your ideal first home.
When you finally do find what you’re looking for, knowing what to do next can be a bit daunting. The amount of available information can be overwhelming. And of course, everyone you know suddenly becomes an expert in buying property when they find out you’re in the market for somewhere to make your own.
How do you know how much to offer? And how can you put yourself in the best buying position possible? Before you dive in, let our first time buyer experts help.
Making yourself a competitive first time buyer in Scotland
Be aware of what you can afford to offer
Our initial guidance for getting on the property ladder is that knowing your budget is one of the most important first steps to owning your own home. Boring, we know. It’s really so much more exciting to window shop for your dream first time buyer home without giving your budget a second thought.
But please, know the limits of your bank account before you start seriously searching. Have a solid idea of what size mortgage you are likely to be approved for, and how much you will have saved towards the property deposit. Speaking to a trusted mortgage advisor at this stage can put you in a good position, as they will be able to chat you through your options to find you the most suitable mortgage deal.
Fun fact, having a Mortgage Agreement in Principle set up from the get-go will make you a more competitive buyer when offering on a home than someone who doesn’t have one! It demonstrates to the seller that you are not a timewaster, and they are more likely to take your interest seriously.
It’s not just the deposit you need to think about at this stage. Remember, there are more initial costs associated with buying a house than looking at the actual cost of the property to you. You must include funds in your initial budget to go towards legal fees, moving costs and Land and Buildings Transaction Tax (LBTT). In Scotland, the rate of LBTT is calculated depending on the price of the property. However, LBTT is not levied on first time buyer homes valued up to £175,000, so keep that in mind when looking for your new home too!
First time buyer homes: Know what monthly bills to expect
As well as your initial investment, it’s important to look at what you will be able to afford each month on your property. With a rough idea of the investment you can afford to make, you can now consider the monthly cost of mortgage repayments, council tax, factor fees, and house insurance. Knowing your monthly outgoings is just as significant as knowing what you have to work with to make that initial offer, so that you are seeking out a property that you know you can afford in the long run.
Instruct a solicitor
Appoint a solicitor as early as you can in your buying journey. Having a solicitor onside will make the process run more smoothly when you find a property that you want to offer on. They can discuss affordability with you, submit notes of interest and negotiate with the seller’s solicitor on your behalf.
Know where all your important documents are
When you find your dream house, having all your documents prepared and in one place is helpful in moving things forward quickly. Just like having your Mortgage in Principle arranged and a solicitor appointed, having these documents to hand will help in showing the seller and their solicitor that you are prepared and serious about buying their property! Important things to have ready include formal ID, proof of deposit, bank statements, proof of income, a copy of your Mortgage in Principle, and details of your conveyancing solicitor.
Shawn Wood, Head of Conveyancing at Watermans, agrees that first time buyers should come into the process as prepared as possible.