The dos and don’ts of looking for a first home
Brought to you by CCPC.
So you’re officially a house hunter.
Now what? Looking for your first home can be a dive into the unknown. You can always ask friends for advice and Google what to do. Still, finding the right home for you can seem like a daunting prospect.
Check out the CCPC buying a home step-by-step guide for a comprehensive take on everything you need to know. In the meantime, we’ve come up with a simple list of “dos and don’ts” to help you to seamlessly make the transition from renter to owner. Here’s what you need to know.
Don’t leave it too late to start saving
It all starts with a deposit so cut back on your spending and work towards saving that lump sum. First time buyers need to save 10% of their house’s value to get a mortgage – that’s €25,000 if your house is worth €250,000. A bit of sacrifice now will be well worth it in the long run.
Do set a budget
Think about how much you can realistically afford to pay on your mortgage each month. Use the CCPC budget planner to work out what you can comfortably afford to repay each month. Just don’t forget to factor in other costs like repairs, furnishing, stamp duty and the likes of legal or surveyor fees when you're working out what you'll need.
Don’t forget to do your homework
Research the mortgages offered by different lenders, assess their interest rates and decide whether a fixed or variable interest rate is for you. That might sound complicated but you’ll quickly get your head around it.
Focus on the available interest rates and calculate how much you'll be paying for the cost of credit over the term of the mortgage. You can use the CCPC mortgage comparison tool to compare all the lenders’ rates in one place and see how much competing mortgages will cost you over the lifetime of the loan.
Do be ready to go
Don’t wait until you find a house to make a move. Save up for a deposit, approach your lender and get mortgage approval in principle so that you’re ready to move when your dream house does come on the market. You need to be able to move quickly in a competitive market and some sellers won’t even show you a house if you don’t have approval in principle.
Don’t discount an area until you know more
If you’re looking in Dublin or a big city, the chances are there’ll be good areas in what are regarded as “bad areas” and bad areas in what are seen as “good areas.” Do your research, judge each place on its merits and chat to people who’ve lived in an area if you can. Dismissing large areas due to stereotypes or perceptions could mean you missing out on a potentially good investment.
Do set up property alerts
It’s a brave new age and your computer can now do a lot of the leg work for you. Set up property alerts on the relevant property sites to let you know when a new house or apartment comes on the market in your price range or in one of your preferred areas.
Don’t think too far ahead
You might see your first home as a step on the property ladder but take it one step at a time. You may not intend staying there indefinitely but make sure it has everything you need before you take the plunge. Does it have enough rooms to serve your current and future needs? Is there parking? How close is it to work/schools? Your circumstances can change so make sure it’s somewhere that you can be happy before you commit.
Do be wary of special offers
There are currently a lot of special offers out there that are offering first time buyers everything from 3% cashback on your mortgage to payment of your legal fees. While these incentives can be attractive, you need to focus on what's really on offer in terms of interest rates and lending terms. Don't end up paying more in the long term for a short-term benefit.
The CCPC offers a range of great guides and tools on their website that can help you find the best deal on your first home. Their step-by-step guide will take you through everything from saving for a deposit to moving into your house. You can also use their mortgage comparison tool to compare the total cost of a mortgage with each lender.
Brought to you by CCPC.