Our experience in the property market, and particularly with property to rent in Liverpool means we’ve become accustomed to the house buying process. This post continues along the theme of hidden costs and how to make savings.

Making an offer and negotiating

If you’re making an offer on a particular property, the asking price must always be treated as a guide. The seller, like most negotiators, is trying to get the best possible deal and may not be expecting you to meet the asking price. It is very important to remember there will almost certainly be a counter off.

Deciding on an opening offer can be a precarious state of affairs. Too low and you risk alienating the seller or being outbid. Too high and you could end up paying too much for the property. It is prudent to firstly determine your maximum amount you’re willing to offer, and then consider how low you’d like to start your offer on the property.

To find this amount, glean as much information as you can about the sellers, the previous cost of the house (can be found on property aggregation sites) and the prices other homes in the area have sold for an current costs

Saving for a deposit

There are obvious benefits to putting down a large deposit when you start the home-buying process. The obvious one is that it will make it that much easier for you to get a mortgage. You’ll also immediately have equity in your property. The larger your deposit, the more protected you are in the event of your property dropping in value; the property would have to experience a drop in value the size of your entire deposit before you were in negative equity.

The first obvious step to saving a deposit for your home is to write yourself a budget. The second obvious step, and the one that will no doubt prove the more difficult, is sticking to that budget.

Evaluate all of your expenditure. Determine what is necessary (rent, council tax, etc) and what you could possibly cut back on or eliminate altogether.

Think about this;

Can I afford Sky TV?
Do i need to eat out more than once a week, can I bring food from home for lunch.
Do I make a lot of expensive phone calls?
Do I have too many credit cards? Should I consolidate my debt?
The gym membership i never use
Do I really need that new book/magazine/car/plasma TV/outfit etc, or do I just want it?

Thinking hard about these extra costs could really help you with paying a mortgage

Alternatively, If you’re looking for a house for rent Liverpool. Visit our sponsors at Bluerow Lettings.

Did you like this? Share it:

Why Would You Buy A Property… Hidden Costs

Do you know the full cost of buying a home?

Here are some expenses you will have to keep in mind.

The cost of your property isn’t the only price you see on in the estate agents window. For example, a lot of buyers, especially first-timers, go over budget on the purchase of their house simply because they haven’t factored in stamp duty.

This means if you have a property to let in Liverpool, you’re in a strong position, as prospective buyers simply wouldn’t be able to afford the full cost of buying a property… particularly first timers.

Here is what a buyer needs to think about;

Home Insurance

Costs vary with this one. It’s a postcode lottery, the same city and depending on your property could mean you pay as little as £170 or as much as per £700

You probably won’t be able to get a mortgage without having it, or at least having the intention too.

To keep costs down;

Shop around
Consider switching from your mortgage company to a general insurance provider;
Use a good broker that will shop around at renewal time for competitive quotes;
Fit high-quality locks on exit doors and windows;
Fit a smoke alarm and insurer-approved burglar alarm;
Join your local Neighbourhood Watch scheme;
Keep valuables to a minimum.

Stamp Duty

Stamp duty is a tax levied by the government on the transfer of properties. Depending on the cost of your property this will be a big one;

1%: Properties of £125,000 to £250,000, but first-time buyers are exempt until 24 March
3%: £250,000 to £500,000
4%: More than £500,000
5%: More than £1m, residential property only

If the purchase price of your house is less than £125,000 you won’t need to pay stamp duty.

Furnishings

Obviously these costs are subjective, but we all know that a bed alone can cost over £1000 and the same for a couch. If you haven’t budgeted, you’re new property could look really really minimal.

You don’t have to buy your furniture all at once, but I’d imagine a minimum of £10,000 to have a standard amount of furniture and fittings.

Moving Costs

If you have a few houses to let Liverpool, you’ll be very aware already of the moving costs. Few people realise that estate agent’s fees can be massive! I’ve heard of fee’s as much as 6% of the value of the property. Remember these are open to negotiation and can vary between 1% and up to 3% of the purchase price, depending on where you live and the state of the market in your area.

Actually moving will incur costs, and some of you may need a storage solution. You’ll need to be proactive in adding these costs to your budget.

Solicitor’s Fees

Expect to pay solicitors fees of around £550 for a house with a purchase price of £100,000.

So if you want to have a regular income and you have a property available to let, you’re in a very good position.

Did you like this? Share it:

More Hidden Costs When Buying A Home

Making an offer and negotiating

Saving for a deposit

Why Would You Buy A Property… Hidden Costs

Do you know the full cost of buying a home?

Categories

Archives