The complete homebuyers’ guide

With house prices having risen by as much as 13% in some towns, many Brits have been tempted back into the property market.

Given it’s probably the biggest financial move you’ll ever make, buying a home can be an extremely nervy affair. Who can you trust? What signs should you look for that a home has been properly cared for?

To help set your fears aside, we provide you with the definitive homebuyers guide.

 

Know that times are tough

 
Get your mortgage application in while you’re in full-time employment if you can. It’s nearly impossible in the current climate for self-employed people to get mortgages.

Don’t leave a full-time job until you’ve secured your mortgage application. Many companies are making cuts, so think how secure you are in your job. You are legally obliged to declare on your mortgage application if you are at risk of redundancy.

Are you secure enough in your job to be buying? Repossessions, although lower than at the start of the year, are still higher than usual.

 

Do your research

 
Investigate online so you can negotiate the right price. Find the prices of similar properties at sites such as nethouse.com and mouseprice.com.

The Land Registry, landreg.gov.uk, has accurate house price information, while portals such as rightmove.co.uk, findaproperty.com and primelocation.com are also useful. If you want to unearth improving areas with room for house price growth, follow new transport links, schools, hospitals and other reasons for people to move there.

While you might not think it, something like a Starbucks could be a sign that a place is on the map – these companies do loads of market research before deciding where to open a store. Also look at areas being regenerated where money is being pumped.

East London is an obvious example owing to the 2012 Olympics. But regeneration is occurring in other places for a variety of reasons.

West Cumbria is now one of the UK’s most important energy industry hubs. Plymouth has become big in the bio-chemistry industry.

 

Could you rent the property if you had to?

 
The past few years have witnessed the growth of the accidental landlord: people who’ve tried to sell but can’t so rent it out instead.

If you think you’ll find yourself in a situation where you’ll have to sell the property and the market is still tough, does it appeal to the rental market?

Is it decorated is a style that appeals to the broadest possible tastes, ie neutrally? Is it near the station and shops?

 

What’s the broadband like?

 
Beware if your moving from a city to the countryside or suburbs as there can often be no or poor broadband or mobile phone coverage.

Find out the telephone number of the property you are thinking of buying then investigate what the broadband is like at coverage web sites.

The UK is also the only country in Europe where roaming agreements between networks only apply to 999 calls.

Again, check your network coverage map online. In addition, make and receive some calls when you’re inside the property.

 

Don’t get taken for a ride at viewings

 
Is the seller determined to have the radio on full blast to drown out the sound of the high-speed trains hurtling past outside?

Or maybe the sound of next door’s bongo-playing squatters? Try and visit the property at different times of the week.

What’s it like during the evening or a Sunday morning? Do any local events take up all the parking? Is there a school run?

The authentic 17th century church next door might be very picturesque, but do the parishioners enjoy weekly vigorous bell-ringing practices on Saturday morning? Speak to the neighbours. What do they think of where they live?

Turn all the lights on and make sure the boiler works. Check the electrical equipment. New builds can be cumbersomely swish. One buyer complained the kitchen blinds could only be operated from a control in the bedroom.

Also try and see a property with the estate agent and not the seller. Estate agents get a tough press, but use them (and you can register with as many as you like) to your advantage.

If you don’t like something about the property, tell the estate agent. They, unlike the seller, won’t take it personally. It will help them gauge what you do and don’t like and they should have a raft of other properties to show you. Ask questions. Get everything in writing.

 

Don’t assume there’s parking

 
Local councils can have some crazy rules on how they issue parking permits. You may find you aren’t allowed to park on your own street.

Permits also don’t often apply to new builds even if the development has its own parking bays. So check when you’re buying if it actually includes parking.

 

Do the commute

 
Take estate agent statements like “it’s 20 minutes to the centre of town by train” with a pinch of salt.

London’s transport system in particular can have mind of its own. Commuting times are rising in the capital and there is an average commute time of 42-51 minutes.

 

Beware of solicitors

 
This is the most stressful part of homebuying and the cause of endless delays.

The conveyancing system is inheritably slow, so paying more won’t necessarily ensure a speedier service, nor will online conveyancing which is becoming popular.

Always go on personal recommendation. Don’t complete on a Friday: solicitors love their long Friday lunches.

 

What if you and your partner split?


Hardly what you what to think about as you sip champagne in the bath, but a cohabitation agreement will outline who gets what in the event of a break-up, which will happen, on average, after three years.

Unmarried couples living together don’t have the same rights as married people. Cohabitation agreements are particularly useful if one party puts in a larger deposit than the other.

They can also outline what happens to possessions such as sofas and bookcases, which can often cause squabbles if nothing’s been safeguarded in writing. They’re also very useful for friends buying together.

Find a competitive mortgage deal

Shop around


Extra costs are countless: insurance premiums, mortgage costs, moving costs, stamp duty, solicitor’s fees, furniture. They are also unavoidable.

But you can make savings, typically 20%, on some if you take the time to shop around online.

Never take insurance or conveyancing products offered to you by an estate agent, broker or IFA.

Watch out for hidden non-refundable fees in your mortgage, whether they be called early redemption fees, closure fees or booking or arrangement fees.

Make sure your IFA or broker is truly independent. Do they charge fees or commission? Remember the tightening of the reigns in the mortgage market means financial advisors aren’t getting the exclusive deals they once did from lenders. So you can them find yourself.

Estate agents fees, if you’re a seller, will ask for a cut of around 2.5-3%. Try and get them as close to 1% as possible. Or you can save thousans of ponds by using an online estate agency such as turtlehomes.co.uk

Fees will be more if using more than one estate agent. If you’re in a chain, have your property market on the market before buying yourself or estate agents will ignore you. Remember a deposit of 5-10% is payable at exchange of contracts if buying off plan.

Additional costs are higher further up the ladder. And they don’t end once you’ve moved. Remember maintenance fees for shared gardens, hallways, lighting etc if buying a flat. You could pay as much as £3,000 every year for your outside windowsills to be painted.

Get a property survey

 
Never rely on the valuation report alone. This merely tells the mortgage lender the property is worth at least what they are lending on it. It won’t point out potentially deal-breaking problems with the property.

Spending a few hundred pounds could save you thousands and a very big mistake in the long run.

A more detailed home condition report, costing from £300 to £500, will look into gas and electricity supplies as well as potential flooding and subsidence problems.

Personal recommendations are always best for surveys. Alternatively, contact the Royal Institution of Chartered Surveyors.

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