How to get on the property ladder in the UK- 10 tips

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Are you struggling to get on the property ladder in the UK and just can’t seem to save enough for the deposit?… If so, this post is just for you!

Many people dream to get out of the renting property or move out of their parents’ house and get on the property ladder. I’ve been there too, and I fully understand how it feels. 

Our little story to begin with…

I and my husband have been renting before and were keen to get out of the rental prison. The rent was soooo expensive and we were paying towards our landlord’s mortgage repayments– not our own! We could not decorate the place the way we wanted and he could kick us out whenever he wanted. In fact, as a couple, we have moved houses 4 times before we bought one.  

Eventually, we have managed to save up for our first house just 3 years into our marriage. This was 9 years ago. We bought a 3-bed semi in west London. Back then the house prices were cheaper, but so were the earnings smaller etc. We have finally got on a property ladder and out of renting. At that point, we had a 2-year-old baby and were very happy to have a house we could call our own. 

Over the years our little family grew and with 5 of us in the house, we felt we need a bigger space, a bigger garden and in a better area.

Only because we have already had a house and made an overpayment on our mortgage, we have managed to get a nice deposit for the current house. 

Last year we have moved to our current house. It’s a 4 bed detached house in Surrey. The house comes with a significant garden that kids love spending time playing around in.  

All this would not be possible if we hadn’t had saved up enough money to put a deposit towards our first house. 

So below I would like to share the top 10 tips on how to get on the property ladder in the UK.

1. Do some preliminary work

Find out what kind of house/ flat can you afford to buy. You can head over to Zoopla or RightMove and look for a place you would like to buy.  

Things to consider are:

The area

If it’s too expensive where you are looking at, look slightly further away and see if prices drop. I know some people had moved out of London as they could not afford a place here, so if you could relocate with work, this might be an option for you too. 

The size of the property

The smaller the cheaper so look for the house with the number of rooms that will accommodate just you and your partner (and a child/ren if you have any) and not guests in case they want to crush. So, if it’s just 3 or even 4 of you, a 2-bed place should be suitable to start with.  

Your credit rating

You will need to find out if you are creditworthy and the bank will be willing to lend you and your partner money. If one of you had some credit issues this might affect your credit rating. There are many free websites where you can run a check for yourself like Experian or Clearscore.

Speak to a broker or a bank

This is to establish how much deposit you will need for the house you would like to buy.

This will help you in determining the following point: 

The goals

How much you need to save?

Once you have established how much your dream house costs, you will know how much deposit you will need to save. There will be many other costs added to it and you need to budget for those too. Include the cost of the broker, bank fees, solicitor, stamp duty, surveys, insurances, hidden costs, cost of moving, possible renovation/ furniture etc.  

How long realistically will take you to save up for the deposit and the other costs mentioned above?

You need to set your expectation as it is one of those things that you will need to work hard for a long period of time. It’s not going to happen overnight and probably will take longer than a year. The best way for it is to set a budget where you list all the savings you can generate monthly and determine how long will take you to save the above set amount.  

Now that you know all the above, here is the way you can save up for a deposit for your first house. 

 

2. Start a frugal living 

If you have never heard of a frugal living please head over to my post where I have written why now is the best time to start frugal life.

5 reasons why you should become frugal during lockdown time.

Frugal living is about being economical and not wasteful. It helps you develop the questioning mind and every time you need to make a financial decision you would ask yourself:

“Do I really need this?”

“Can I get it cheaper?”

“Can I get it later?” 

“Are there better deals available”.

This, in turn, can save you tons of money which will be very helpful when saving for a big goal like buying your first house. 

This is something we have learned when saving for a deposit. Living frugally allowed us to save enough in just over 2 years to buy our first house. 

 

3.Learn to sacrifice 

If you one of those people/couple that like going out, hosting parties, socialising overall, you will need to calm it down A LOT.

You are probably aware that each time you go out for a meal you easily spend £40/couple vs. if you were to cook at home you could spend less than £10/couple. That’s already £30 in a saving box to put away to get on the property ladder sooner.

Be honest with yourself and count how many times have you been out or hosted and how much did you spend. I am sure you would be surprised that it will be a significant amount of money that you could save instead.  

I am not saying stop everything altogether. But you do need to reduce those unnecessary spending in favour of your dream house. Your friends should understand and soon you will be able to host them in your brand new home.

Just think for a minute- how happy and proud you would be to host your party in the house you can call your own! 

These are what I call short term sacrifices for a long-term benefit.  

 

4. Get your partner on the same page as you  

This might be obvious but sometimes it’s hard to talk Money with your partner and it’s best to establish this at the very beginning.

You both must communicate if you want to reach a mutual goal and you both need to stick to it. Only by the joint effort, you can achieve this successfully. 

 

5. Cut down on pleasures 

Above in point 3, I was talking about cutting down on going out. 

Here I want to point out that the cost of treats can add up to a vast amount of money. Whether that’s a branded sunglass, a new handbag or a pair of courts, these things might seem like a small amount at the start. But added across the year these small expenses would have an impact on the amount you can put away to get on the property ladder sooner.

The hair salons, nail shops, beauty bars, SPA’s or masseurs all cost a lot of money too, see if you could cut down on those.

Every little helps.  

 

6. Don’t take unnecessary loans, finances, credit cards 

Having a credit card will help you build up a credit rating (if you have been paying it off on time), However, be wary that having any loan against you will reduce the amount the bank would want to lend you. So, if you have just taken out a loan, aim to pay it off first before you apply for a mortgage.

Every single financial liability (including a student loan) would be reducing the amount you can borrow. 

 

7. Take double shifts, side hustle, or extra paid jobs 

If you have one job each only, that gives you two streams of income to save from. Having side hustles would add to those or let you live off it and save the whole of your main income.  

There are so many options to choose from to earn extra money… From walking your neighbor’s dog, through to looking after someone’s baby part-time, or even local paper run can bring a little more income in. If this is not an option and you want to earn some money from home, why not freelancing on Upwork or Fiver.

The internet has many options open for those wanting to work from home and blogging or YouTubing is yet another one to explore. My fellow blogger has written a great article about a side hustles so please check it out here.

 

8. Ask for help

So you have been saving hard for the last year or so and you nearly got enough saved for the house, and you find the one that you really can picture yourself moving into. Yet, you still have not got enough saved. Don’t let the house pass by especially if it feels right for you.  

Ask for financial help.

Do you have a family member that could lend you some money?

It’s hard to ask for money, but this is a big thing… most people would be happy for you to be getting on the property ladder and happily lend you some money. Yes, it’s another debt to add, but hence it’s not from the bank it does not affect your credit rating and you don’t have to mention it to the bank either. If needed – sign a little agreement and agree on what monthly payments term you would be comfortable with. Or hopefully, they will trust you enough to just verbally agree. Consider your parents, siblings, in-laws, aunts, uncles, friends or even business partners. You know best who would be willing to help, yet if you don’t ask, you don’t get. 

 

9. Move into parents’ house 

If this is an option for you and you are currently renting, see if it’s possible to move into your parents/in-law’s house. It’s a temporary measure and will help you save up on the accommodations cost. 

It’s not an ideal solution and I fully appreciate things that might get tricky, but for a while take a different view on it and just have a thing about it. Discuss it with your partner and see what you both think… 

 

10. Negotiate

Once you have the money and you have found some nice houses to view, and one that you particularity like is a little above your budget, you should still put an offer through. So, if the house is costing say £250k and you can only afford £220k, put such an offer through.

Sometimes the sellers are just desperate to move and the house is on the market for a long time and they would be willing to take a lower offer no matter how insulting it might look.  

 

Few more things to take into consideration that would allow you to negotiate the price are: 

• The house is in a not sought-after area 
• The house is far from local transport links or shops 
• It needs a lot of work or some decorating to bring it to a liveable standard 
• It has some other issue discovered during area and survey searches such as major cracks or flood risk area 
• The house has been on the market for a significant amount of time (ask the agent and they should answer this) 

 

Just as a side note I wanted to share one tip with you

When we were putting the offer on our current house (last year) the estate agent did not get back to us for a few days and we had a feeling he did not communicate this to the current owner.

One day after work my husband had asked me to drive to the house, knock on the door and speak to the old lady myself. She had let me inside the house, and we have made a deal there and then. She had promised the house will be sold to us. She had no idea we had already made an offer to an agent she was using, as they have not communicated it to her!

Not only she was disappointed that they had not let her know about the offer, but also she told them not to send anyone else for viewing as the house was being sold to us! And our offer was 20k lower than the asking price!

The lady appreciated my direct approach. She had been living in the house for nearly 40 years and had moved in with her husband when their children were very young (just like us).  

Sometimes the “old fashion” way of introducing yourself to the seller and putting the offer directly might do just a trick like in our case. 

 

Conclusion 

In the above 10 tips on how to get on the property ladder in the UK, I have gone through the details of all the things you need to know and prepare for when considering buying your first house. 

This could be an exciting chapter of everyone’s life and provides with a great sense of achievement. But the journey will be a challenging one and requires focus, dedication and sacrifices.  

If you really want something, you must work for it, as (unless you win a lottery) nothing comes easy in life.  

I hope you have enjoyed the tips on how to get on the property ladder in the UK and found it useful. Please let me know in the comments below at what stage of getting on the property ladder are you currently at and if there are any questions you would like me to address. 

Thank you so much for reading.

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