Buying a home for the first time is not only a huge investment, but the process can be extremely daunting, too.
In this guide, we’ll reveal seven do’s and don’ts of buying a house, alongside some great advice on buying for the first time.
Things to do when buying a property for the first time
1. Save a good deposit
Saving a good deposit is key to buying a property for the first time – but it’s also the hardest part of the process.
Saving enough money for a first-time deposit can be tough, but the more you can save, the more benefits you see, including:
- Cheaper monthly mortgage repayments
- A lower mortgage interest rate
- More immediate equity in your property
- Less chance of negative equity
- A simpler mortgage application process
How much deposit do I need to buy a house?
Most mortgage lenders will require you to put down at least a 10% deposit on the property you wish to buy.
The average first-time buyer deposit in the UK is 15%, although it’s also possible to buy with a 5% deposit in some cases.
In 2021, the average first-time buyer deposit in the UK was £58,986 – an average of 23% of the purchase price.
2. Stick to your budget
Before you start viewing properties, work out the maximum budget you have to buy your first home.
Your budget should include your maximum purchase price, as well as all other costs that come with buying a home.
While it can be tempting to stretch your budget for the property of your dreams, try to stick to what you set out at the beginning.
What fees can I expect when buying a house?
As well as your property’s purchase price, there are a whole range of costs and fees you’ll need to factor into your budget when buying for the first time:
On average, mortgage arrangement fees cost £1,000. Some more attractive rates cost more. Consider whether to add this fee to your mortgage, in which case you'll pay interest on it, or pay it up front.
Your mortgage lender needs to know that the property you are buying is worth what you are paying for it. This fee usually costs around £250, although some lenders will cover the cost.
Solicitor or conveyancing fees
The legal work involved in a property purchase is vast. So, solicitor's fees, which are payable on completion of your purchase, can be anywhere between £500 and £1,500 depending on the value of your new home.
As a first-time buyer, you’ll pay no stamp duty on the first £300,000 of your property’s purchase price as long as it’s costing less than £500,000.
Although optional, for a fee of around £400, a survey can provide crucial peace of mind that the property you are buying is worth what you are paying, as well as eliminating any nasty post-completion surprises.
Moving your belongings to your new home can cost anywhere between £100 to £1,000 depending on how much you own and the distance you’re moving.
3. Boost your borrowing potential
As a first-time buyer, it’s important to make a good financial impression when applying for a mortgage.
To give yourself the best chance of borrowing the amount you need for your first property, try to:
- Check your credit report online and correct any errors
- Repay any debts you owe and ensure all credit is paid on time
- Keep good records of your income and expenditure, including pay slips, P60s, and bank statements
What can I borrow to buy my first property?
Your mortgage lender will assess your borrowing potential based on your income and financial circumstances.
Exactly what you can borrow will also depend on your lender’s own criteria, but the best place to start is an online mortgage calculator.
This will give you an idea of what you could potentially borrow, but your lender will do a much more thorough assessment of your finances before deciding how much to lend you.
4. Think carefully about property and location
Take some time to think about the kind of property that will suit your needs, as well as the location you want to live in.
Sometimes, moving to the postcode next door can mean a huge drop (or rise) in property prices, so consider your location needs against your budget.
Also, buying a flat rather than a house could mean you’ll pay less for your first home, so think about your needs when it comes to bedrooms, outdoor space and ease of access.
Average property prices by region
Property prices vary hugely across the UK.
Here are the average prices you can expect to pay in each region*:
Average property price
Yorkshire & Humber
East of England
* Prices from Rightmove’s House Price Index, March 2022
5. Be proactive with documentation
When applying for a mortgage and going through the conveyancing process, your lender and solicitor will require a range of documents from you.
And the faster you can provide them, the quicker your first property purchase will be.
Documentation your lender may require includes:
- Passport or driving licence
- Council tax or utility bill
- Bank statements
- Credit card statements
- Store card statements
- Certified accounts (self-employed)
- SA302 tax calculations (self-employed)
- Evidence of dividend payments
Your solicitor or conveyancer will also require your passport or driving licence for proof of identity and a dated utility or council tax bill for proof of current address.
How long does it take to buy a property?
The time it takes to buy a property in the UK is between three and six months.
However, this can vary depending on the complexity of the purchase and the length of the chain.
6. Stay focused on viewings
The fun part of buying your first home is viewing lots of properties.
However, it’s important not to get too emotionally involved when on a viewing.
Try to stay focused on the practicalities as well as the emotions.
As you walk around, look for problems that could end up costing you money, including:
- Structural issues
- Signs of damp
- You should also assess if there’s:
- How much storage there is
- The size of the rooms
- The noise of the neighbourhood
- The size and direction of the garden
What questions should I ask on a property viewing?
Prepare a list of key questions to ask your estate agent when on a viewing.
Our top-10 questions to ask can help get your started.
7. Always get a survey
Unless you’re buying a new-build home, having a survey is always money well spent.
A property survey will either reveal any major problems or confirm that the property you want to buy is structurally sound.
With older homes in particular, a full survey is hugely important and provides incredible peace of mind.
What type of survey should I get?
There are several different types of survey you could consider, depending on the age and condition of the property you’re looking to buy:
RICS Home Survey Level 1
Previously called a Condition Report, this is the most basic survey and the cheapest, providing a traffic light rating on the property’s condition with only small amounts of detail.
RICS Home Survey Level 2
Formerly called a Homebuyer Report, the Level 2 survey includes everything from the Level 1 survey, plus a report on roof spaces.
The Level 2 survey will also provide recommendations and budget advice for repairs.
RICS Home Survey Level 3
Usually recommended for properties older than 50, the Level 3 survey looks in much more detail at the property’s structure and provides detailed recommendations and costs for any remedial work required.
Things not to do when buying a property for the first time
1. Don’t increase your debt
Once you’ve decided to buy your first home, you should set about reducing any debt you have.
By taking on more credit, you’ll reduce your borrowing potential in the eyes of mortgage lenders – affecting your ability to buy your first home.
What will my credit report tell mortgage lenders?
By performing a credit search, mortgage lenders will be able to:
Assess your previous borrowing and see any late payments
See any County Court Judgments or insolvency issues like bankruptcy
A ‘hard’ search by a lender, to look in detail at your credit history, will leave a footprint on your credit file and can affect your score.
A ‘soft’ search, however, which is often done by a lender before they issue you with an agreement in principle, will have no impact on your score and only shows your lender the main pieces of information on your file.
2. Don’t change jobs
One of the most important things a mortgage lender will look for in you is stability and a regular income.
So, once you’ve decided to buy your first property, try not to change jobs.
If you do more employers just before you complete your mortgage application, your lender may require additional information to confirm your salary and contract.
What proof of income will I need for a mortgage?
If you’re employed, most lenders will require at least:
Three months of payslips
- Your latest P60
- Three months of bank statements
If you’re self-employed or a company director, your lender will need:
- At least two years’ certified accounts
- Proof of dividends
- Two years of SA302 tax calculations
- Evidence of future contracts
3. Don’t rush into a decision
In a busy seller’s market, the fear of losing a property you love can sometimes spur you into making too quick a decision and stretching your budget.
Try not to rush into anything until you’ve taken time to assess everything about the property and how it will work for you.
Only pay what you can afford for your first home and that can sometimes mean walking away from a particular property you love.
How do I negotiate with a seller?
When making an offer for a property, you should:
Make sure you have a mortgage agreement in principle
Always sell your situation – first-time buyers have nothing to sell, so are appealing to sellers
Hold your nerve and think about whether increasing your offer is the right step
4. Don’t forget about the future
When viewing properties to buy, always think about how long you plan to stay and what your future may look like.
A first home is very rarely a forever home.
So, try to look at your first property as a steppingstone for what’s next.
That could be:
- Moving in with a partner
- Having children
- Moving jobs or moving abroad
- Moving to a more expensive area
How does joint ownership work?
When buying with someone else, you can either become joint tenants or tenants in common.
Joint tenancies are more common when buying with a partner or spouse, as each person owns an equal share of the property.
And should one person pass away, the property automatically passes to the surviving owner.
Tenancies in common, meanwhile, often see each person own a different share of the property, which is useful if one person is putting more towards the deposit than the other.
Tenants in common also have no automatic right to the other owner’s share on death, which each owner able to pass their share to another beneficiary if they wish.
5. Don’t stretch your finances
Borrowing more than you’re comfortable with can place added stress on owning your own property when you should be enjoying it.
Try to keep to your budget and only pay what you think a property is truly worth.
While stretching your budget by a few thousand pounds might seem worth it, it could amount to far more money over the term of your mortgage, while also increasing your borrowing with your lender.
What are the different types of first-time buyer schemes?
If your budget is being tested by rising property prices, or you’re finding saving a deposit tough, you could consider a homebuying scheme.
Help to Buy and Shared Ownership are the two main government-backed schemes for first-time buyers and both offer options to buy with only a 5% deposit.
6. Don’t forget about bills
Once you own your own home, you’re responsible for all the bills and costs that come with it.
Those could include:
- Gas and electric
- Broadband and TV
- Water and sewerage
- Council tax
- Ground rent and maintenance charges
- Insurance costs
When assessing how affordable your monthly mortgage payments will be, remember to factor in all these bills and costs.
What kind of insurance will I need as a homeowner?
When you buy a property with a mortgage, your lender will insist you have an adequate buildings insurance policy.
This protects you and your lender against damage or destruction caused to your property by fire, flood or a break-in.
Other insurance policies you could consider as a homeowner include:
- Contents insurance
- Life insurance
7. Don’t ignore advice from others
As a first-time buyer, it’s key to take sound advice from other people more experienced in buying property.
That could mean parents or siblings, or an experienced estate agent or mortgage broker.
Always seek advice from others if you’re feeling overwhelmed and ask as many questions of estate agents, solicitors, brokers, and mortgage lenders as you can.
Can I borrow my deposit from my parents?
Borrowing a deposit from parents is more common as property prices continue to rise in the UK.
It’s completely possible for your parents to contribute to your deposit, but the terms with which they contribute are key.
The simplest way is for your parents to gift you the deposit, meaning you won’t have to pay it back.
This method means the deposit won’t count as a loan and negatively affect your borrowing potential.
However, if your parents were to pass away within seven years of gifting you your deposit, you may be liable for inheritance tax.
Always seek independent financial advice before accepting a gifted deposit.