Whether you’re thinking about buying a house sometime in the future but don’t really have your mind set on anything particular, or you’d like to start thinking about it within the next year or so, one of the main considerations when it comes to buying a house is saving for that initial deposit that goes towards your mortgage.
Depending on where you live, average deposits can start as low as 5% and go up to as high as 20%. So, although there are different deciding factors in how much you’ll need to put down as a deposit, it’s still going to be a good chunk of cash that you’ll need to have saved up.
Saving will look different for everyone and there will be aspects of this that may come easier or be more challenging for you.
In this post, we’re going to share with you 3 ways you can start saving for your house deposit.
- Start Budgeting
If you’ve not been budgeting until now, then this is absolutely the time to start. Although you shouldn’t be waiting until you need to save for something like a deposit to start budgeting – it’s something you should be doing in order to stay on top of your finances always.
Creating a budget doesn’t need to be complicated or fancy. You can use a piece of paper and a pen or a simple Excel spreadsheet to track your income and expenses each month and make sure you’re allocating money to each thing that’s to be paid and then whatever is leftover is yours.
Including a percentage of your income based on what you can afford each month for saving towards a mortgage will make saving easier than just choosing a random number.
2. Look At Help To Buy Schemes
Over the last 20 or so years, first-time buyers have been increasingly struggling to get on the property ladder. Governments and banks have been working together to create new incentives, such as help to buy grants, dedicated ISAs and even Concessionary Purchase mortgages.
To find out if you’re eligible for any of these and learn more about which would be best suited to your needs, you should speak to your bank or mortgage experts. A handy resource can be found on Mortgage Experts Online who have highlighted the key facts you need to be aware of in regards to Concessionary Purchase Mortgages. Essentially, this is when your property is bought for less than its market value typically between family members or a landlord selling to the tenant.
3.Make Spending Cuts
When saving for something – especially a bigger thing like a deposit, then it’s going to require some sacrifice.
Although it may not seem like you spend a lot of money on things, if you’re not tracking your spending, then you’ll be quite surprised by just how much you could be saving by making cuts on things like your takeaway on a day(s) you don’t fancy cooking yourself.
You can also prioritise your spending and look at ways to cut back, such as speaking to your phone provider and asking them if they have a better deal than you’re currently getting. You can use sites such as Compare my mobile to see if you are on a good deal already and switch if not. I actually pay for my SIM £0 but I haggled that as I had my broadband and mobile SIMin the same place so as soon as I said I am leaving they offered me a FREE SIM 🙂 So I think I am saving at least £60 per year on my mobile if not more:-)
Over time, everything adds up and makes a difference.
As you can see, saving for a house deposit will definitely take some work and commitment, but it’s amazing what you’ll be able to achieve if you stick to your plan of saving and remain focused on the end goal.
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