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10 Worst First-Time Buyer Mistakes

10 Worst First-Time Buyer Mistakes

The process of buying your first home can be fraught with trepidation and worry but above all, excitement. It can take nerves of steel to take the plunge and make an offer but done sensibly, can turn out to be a life enhancing decision. The key to ensuring a smooth transition into home ownership is to maintain focus and try not to let emotion get in the way. Here a few pitfalls that you should try and avoid.

1. Don’t fail to secure an Agreement in Principle

Before you begin your property hunt, it is advisable to secure an ‘agreement in principle’ from a mortgage lender. Vendors will want to know that there is a lender willing to approve your mortgage before they will start accepting offers. It would be very disappointing to find the perfect property only to discover that somebody who already has a mortgage offer in place has an offer accepted first. Start thinking about your credit rating a few months in advance of your application to ensure that all the information is accurate and to give you time to amend your details if there are any problems.

2. Don’t forget to be realistic about moving costs

Once you have secured an agreement in principle, don’t underestimate how much the process of moving will cost you. Stamp duty can be prohibitively expensive for the unprepared. You also need to consider your deposit, legal fees, moving fees, mortgage arrangement fee and any new furniture or decorating equipment that you need to buy before moving in. You may want to consider an emergency fund for any surprise costs that occur during the move as well.

3. Don’t forget to get a quote for home insurance

Once you have identified an area that you’d like to live in and the best type of house, check how much home insurance is likely to cost. If your desired postcode is in a high crime neighbourhood or at high risk of flooding, you may find that the cost of your buildings and contents insurance is higher than expected. Factor this into your financial planning to ensure that you can still afford the area you’d hoped for.

4. Don’t forget to calculate your household budget

Although your monthly mortgage fee may seem reasonable in isolation, consider your other outgoings before committing. First of all, have you chosen a fixed rate mortgage? If not, bear in mind that a variable rate mortgage moves in line with interest rates. A small increase in interest rates can quickly mean that your mortgage becomes unaffordable. Think also about other costs that you incur on a weekly, monthly and annual basis such as vehicle costs, student loan, credit cards, shopping budget, insurance and pension. Be very honest about whether you will be stretching yourself too far.

5. Don’t become too emotionally attached

At the point that your mortgage has been agreed in principle and you have decided that you can afford to buy the type of property you want you then you can start looking. This is the exciting bit and it can be easy to fall in love with a property and talk yourself into believing that this is the home for you. If possible try to find more than one house that fits your criteria to allow yourself  options. One of the risks of becoming very emotionally involved with a property is that if you end up in a bidding war, you may end up paying more than you intended to secure the house.

6. Don’t go it alone

It feels quite easy these days to do the property searching by yourself, a little bit like Internet shopping. However, getting yourself a good estate agent can be really helpful. This gives a third-party view on your position. A good agent can tell you more about the area, future development plans and what is happening to prices in the neighbourhood. They may offer alternative options that you hadn’t considered.

7. Don’t forget to make a list

Before you begin viewing a vast array of properties, it is useful to make a list in order to stay focused on what is really important. Don’t ignore the things that you originally identified as crucial, for example number of bedrooms, proximity to work or your favourite area. You made these decisions for a reason. During a house search, compromises are necessary but you need to work out which items on your list are non-negotiable, both now and for the future.

8. Don’t just see the decor

Some of the best properties require a little bit of vision in order to see the beauty and potential. You need to try and see beyond the current decoration and furniture. Try to imagine rooms as a blank canvas filled with your own belongings. It is often cheaper to buy a property that needs some love and attention, rather than a property that has already been modernised, as the work that the vendor has already done will mean that the house comes with a higher price tag.

9. Don’t forget to have a thorough inspection

Before the mortgage company agrees to offer you money to buy the house they will require a basic valuation survey to be done. You then have the option to pay for a more in-depth inspection. Although money is tight when you’re moving to a new house, think sensibly about what it may cost you in the long run if you are not in possession of all the facts. In particular if you are buying an older property it is prudent to get a more thorough survey done to flag up any major work that the property requires. This also gives you some leverage when negotiating a final price with the vendor. You may even choose to ask the vendor to complete repairs prior to the sale.

10. Don’t fail to read the small print

Possibly one of the most boring aspects of house buying is reading the deeds. But checking the small print can save you a lot of grief in the long run. Many homes have restrictions placed on the usage. Often these are historical but still legally binding. Ensure that the restrictions don’t clash with your plans for home improvement or expansion. They could also restrict the type of pets you have or your ability to run a business from home. Also, be aware if you are buying a leasehold property to check how many years are left remaining on the lease. If there are 80 years or less this can mean that you will have a problem getting a mortgage agreed and selling the property in the future.

With all these pitfalls avoided, your new house purchase should bring you joy for many years to come!


Phoebe Skinner

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