Saving for our own Home

All my recent posts about moving or doing up our house have made me reminisce about our own journey to owning this house and how we managed to save for it. We purchased our house in a village called Stamford Bridge which is around 10 miles East of York and if you’ve ever driven to Bridlington; then you’ve driven through it. If you fancy seeing just the highlights then you can watch the video I recently filmed with Post Office Money below.

We purchased our house which you can see above (this was the first photo we ever saw of the house when it came on the market), in June 2016 for £250’000.00. It was the absolute top of our budget at the time but we instantly fell in love with it once we’d been round it and put an offer in within 30 minutes of leaving the property. 12 Hours later on Saturday morning we had a call from the estate agents to advise us the property was ours and we were over the moon! The journey to this point was a rollercoaster and we had to cut back on things as well as compromise on our original location in a bid to get to that stage but I wanted to share that it is in fact do-able.Let’s start at the beginning of our journey and the mission to save the deposit. New Post Office Money research reveals the average First Time Buyer will spend 4 years adjusting their lifestyle to save for their dream starter home. For me I made it my mission from the age of 17 to save my deposit all on my own for my first house. I’ve always worked since then (barring maternity leave) and for the last 9 years have worked for the same company. Each and every payday I scrutinised my finances and split my money in 3 ways:

1.Bills Account – this was mainly mobile phone/gym membership whilst living at home

2.Monthly Spends – what I predicted I would need like petrol or money for lunches etc

3.Savings Account – the remainder of my income was tucked away into savings to avoid the need to dip into it here and there.

Now an important factor of being able to save for me was that I was able to live at home during this period but did contribute money to my mum each month as a form of rent and would buy things for myself whenever I wanted something. I never relied on my mum to buy me stuff anymore.

Bob went to University in 2010 for 3 years so he had the experience of living away from his parents which was not something I had myself. When we eventually bought our first home, it was completely brand new for me to take on not only paying bills etc, but also cleaning and maintaining my own space. According to Post Office Money’s research, 1 in 5 people will move back home or downgrade their rental property to something more affordable in a bid to save their deposit. Bob also contributed rent to his parents once he returned home from university.

Moving onto the house buying journey then which started for us back in 2014. At this point we had around £20-21K saved up and started looking at properties in York. This was due to my use of public transport for work so we thought it made sense to be nearer these transport links. We viewed several properties in areas that we liked and even were outbid on one that was lovely, but more and more we realised we wouldn’t be getting as much for our money and were compromising on space with our budget. The research from Post Office Money also confirms that this is a big area where First Time Buyers have to adjust their expectations and that 63% of them will look at other areas due to affordability. On average First Time Buyers will move just over 5miles away from their original location.

We then opted to widen the search area to Stamford Bridge which was where Bob grew up. At this stage we were still avidly saving but our house options seemed a lot more open in this area. In the Autumn of 2014 we put an offer in on a 2 bedroom railway cottage that could do with a little bit of work but was lovely and traditional inside. We opted to pay more for a more in depth property survey which paid off as it alluded to lack of planning permission for extensions to the property. This then resulted in us pulling out of the purchase as we thought it was going to be too much risk and too much work to put right again.

Moving into 2015 we then found a 3 bedroom detached property a stones throw from the cottage we had looked at. It was vacant due to being a rental property beforehand so the vendor wanted a quick sale. We put an offer in below the asking price and it was accepted within the same day. Now it’s safe to say we thought we had nailed it with this property and were excited about the prospect of moving in but 3 weeks later our world came tumbling down when we got a call from the estate agents. Someone who has viewed the property before us had come in with a very late offer but more than ours and the vendor wanted the extra money. We weren’t given much of a chance to increase ours as at the time it would have pushed our budget too much so we settled in defeat. I have one word though for that one which was KARMA, 4 weeks later we got a call to say the deal had fallen through and were we still interested and it was a big fat NO.

After this we had a bit of a break in looking for properties as Bob actually moved down to Crawley for 6 months for work. It was a difficult time but we knew that long term this would be a smart career move as it would give him a wider knowledge of the business area he is in.

October 2015 soon came round and both us were in new jobs with higher wages meaning we could really hammer our savings. We had enjoyed some nice holidays in the previous years up to this point but we decided if we could cut back on takeaways and nights out, we would be able to stretch our budget even further. Research has found that 31% of first time buyers would rather compromise on their own lifestyle to save for a deposit, than on the property or area they were looking in.

Just before Christmas we found a gorgeous 14 year old semi detached 3 bed townhouse almost in the centre of the village. It was modern and would require very little doing to it so we viewed it and put an offer in quickly. It was accepted and the ball got rolling for the purchase. Now you’ll be on the edge of your seats because you know what comes next. That house picture at the start of my post is not a 3 bed townhouse! That’s right by February, the vendor pulled out of the sale due to family circumstances and being under a lot of stress. Funnily enough the house came back on the market later in the year and our friends actually bought it.

Time to sit back and re-evaluate our plans we thought and we decided not to avidly search for a few weeks and just concentrate on ourselves. Thursday morning the dream house came on the market, I showed it to Bob and he booked the viewing for the following day. The rest I already shared with you earlier in the post and today marks 2 years and 3 months in the house. Thank goodness we finally bought a house eh?

We started our journey in York looking at properties around £170k and ended up 10 miles away in a beautiful, friendly village with a house worth £250k. We put a 10% deposit down on the property and saved a further £3-4k for solicitors fees and stamp duty (something people might forget about when they start to save for a house). We did it with no financial help from family members other than the ability to live at home and pay a reduced rent but did compromise on our original location.

Now onto the reason I’m sharing this incredibly long post with you; Post Office Money has also launched a new online tool, allowing new buyers to map out their deposit plans based specifically on property affordability in their chosen area:

They’ve also shared some top tips of which most of them applied to us at some point in our journey.

Top tips for people saving towards their first home

Cut back on the essentials – the easiest (and most common) way people manage to set more money aside when saving for their first home is finding ways to cut down on their day-to-day spending. This could be as simple as switching to supermarket basic brands, comparing energy and mobile providers to see if you could reduce your bill or even seeing if it’s possible to reduce your rent by moving to a less expensive property.

Map out a deposit goal and stick to it; particularly if putting aside money with a partner – very few people save without assistance from their loved ones and first-time buyers will often be planning to purchase their home with a partner. Be sure to agree how much you can both commit to save realistically on a monthly basis and hold each other accountable, so it’s more difficult to splurge. Look for tools that may help you, there are a range of apps and calculators freely available to help you plan your savings journey, such as the Post Office online tool:

Can you reduce how much you need to save? – If your goal seems out of reach you could always consider how you might reduce the pot you need to save, such as buying a smaller property, looking at a different location or considering no-deposit mortgages.

Have an honest conversation with loved ones about financial support – it’s common for FTBs to get some degree of financial support from their families as they attempt to get on the ladder – more than half will do so as they attempt to pull the money together for their first home. Be sure that when doing so you have an open and honest conversation about the terms of the agreement. If they are providing you with a gift or a loan and if it’s a loan, being clear on what they expect in terms of regular repayments.

Keep an eye on how affordability shifts and incorporate that into your plan – four years is a long time in our uncertain housing market and you want to make sure you’re aware of how things shift while you save. Be sure to keep an eye on how local property prices change so you can make the most informed purchase possible.

When looking to buy, seek out up-and-coming areas – young buyers often need to adjust their expectations when it comes to location but you can often sniff out which areas are likely to increase in value by looking out for new developments, new businesses setting up shop in the area or improvements in local schools and crime rates.

Don’t be disheartened if you have a set-back – 13% of FTB savers feel like a failure for not reaching their savings goal in the time they initially intended and it’s very common for savers to end up dipping into their deposit fund to pay for other expenses. While it’s obviously best not to make a habit of this, prospective homebuyers shouldn’t let a small slip-up deter them as they continue to save towards their goal.

The last tip 100% resonates with us and definitely is something to always remember if you are on this journey. Owning your own home is amazing and something to be incredibly proud of but isn’t always an easy process to get through. Let me know in the comments if you’re currently going through the first time buyer process and how you’re finding it.

Laura x

*This is a paid collaboration with Post Office Money*

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