7 Practical Ways to Stretch Your Budget When Buying a Property

From selecting the less trendy styles, to taking advantage of government schemes, here is how you can find the find the right home for you at the right price.

Can’t quite afford the property you are looking for? Do not despair! Today we are showing you how you can stretch your budget and save faster for that dream property.

1. Buy an Older Home That Requires a Bit of Fixing Up

You may find that you can afford a larger home if you go for one that is need of modernisation.

Look for properties that are in a liveable condition, that way you can benefit from installing some modern fixtures and fittings, as well as take the time to make the property a home.

Older properties used to be more expensive than their new-build equivalents. However, Land Registry figures suggest that brand new properties sell for an average premium of £65,000 over existing housing stock. That is an astonishing figure!

In many parts of the UK, the additional £65,000 would be enough cash to get an extra bedroom or even a period property!

2. Buy a Property Where There is Potential to Extend

If you cannot afford a property with the number of bedrooms you want, think about looking for a smaller home with the opportunity to create more space.

You could get the extra bedroom you need by building an extension once you have saved up.

The government has recently relaxed planning rules to create a fast-track system for those wanting to add up to two storeys to their property.

Find out more about planning permission here.

Building an extension is typically the cheaper alternative to paying the premium you would pay for a property of the comparable size. The value of your home will also rise once the extension is complete.

Remember, when you are considering extending your property, you do not have to just build out. A loft conversion, basement or garage conversion could give you all the space you will need.

3. Avoid Paying for Benefits you Do Not Need

Explore whether there are factors that may be driving the prices of property prices up in the area you are looking at, and if they are relevant to you.

For example, some buyers are prepared to pay significant premiums for properties in particular locations. Homes that are in a catchment area of a top state school will often sell for 12% more.

In addition, being in walking distance from a train station can also increase property prices.

However, if you do not have children and work from home for example, there is no need to fork out for either of these perks.

Instead, why not search for properties nearby that do not carry these premiums?

4. Prepare to DIY to Save You Some Pennies

Purchasing a property that you can work on yourself is another way to stretch your budget and make the house your own.

Old fashioned interior design can quickly and cheaply be replaced and dated kitchens and bathrooms can also be improved with a bit creativity.

 Yet, many buyers are put off by the task, leading to a lower asking price.

Properties that require larger jobs such as installing central heating or double glazing, or needs rewiring, tend to come with heftier discounts.

Remember to balance the cost of improvements that are needed against the discount on the property’s asking price. This is to ensure you are getting a good deal.

Additionally, do not forget to make sure you know how to do the DIY jobs that will save you money. Otherwise, you could have an expensive problem on your hands down the line.

5. Consider a Less Trendy Property

New-build homes may sell at a premium, but period properties are just as popular.

Going for a less fashionable property or being willing to compromise on the style of your home may offer you more space for even less money.

For example, homes that are built in the 60s, 70s and 80s are considered less fashionable than Victorian or Edwardian properties.

Do not be put off by an ‘ugly’ or dated property. The only things that cannot be changed is the location and the amount of light it gets!

6. Look Beyond Your Ideal Location

If you cannot afford the home you want in your search area, start rethinking the location you have selected.

Make a list of the factors that attracted you to that area in the first place. Then, see if there are any other areas nearby that meet the same criteria but have lower house prices.

If you were looking in a well-established area, try and search for an up-and-coming one that is nearby.

Consider if increasing your journey to work by an additional 15 minutes has a significant impact on the size of the home you can afford. You never know, you may stumble upon an unexpected gem nearby.

7. Look into Government Help Schemes

A government scheme may enable you to stretch your budget for your target property. See below some examples of government schemes that could help you.

Help to Buy

Why not investigate the Help to Buy equity loan scheme?

With Help to Buy, first-time buyers can purchase a new-build home using a five-year, interest-free equity loan of 20% of the property’s value.

The Help to Buy scheme had a revamp in early 2021. Unlike the prior equity loan scheme, which was available to all buyers, the current version is only open to first-time buyers.

The current scheme will run until March 2023 and regional property price caps have also been introduced.

Shared Ownership

Another option you may consider is whether you are eligible for shared ownership.

It is a scheme where you buy a portion (such as 50%) of a property from a housing association and rent the rest at a discounted rate.

You do have the option to gradually increase your stake in the property as and when you can afford to, which is also known as staircasing.

Did these tips help you? Are you looking to seek more advice from a property professional? Why not give our friendly team a call today on 01332 383838 or email [email protected]. We even have a live chat available now, for instant responses from real property professionals!

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