The cost of buying a home can be surprising – from the deposit, to the extra fees and mortgage repayments once you’ve moved in. But, there are some clever ways you can cut costs at every stage of your home-buying journey! Our experts have put together their top tips to save you money at every turn.
1. Negotiate on house price
It’s a buyers market at the moment, with many sellers accepting offers under asking prices – so don’t be afraid of flexing your negotiating skills. This can be a risky strategy if you’re competing with lots of other buyers for the same property! If your home survey shows repairs are needed, you can use these to renegotiate the final house price with the seller. They won’t always agree, but it’s well worth asking, as they might agree to shave a few hundred or thousand pounds off the price to finalise the sale.
2. Buy a fixer-upper
Ever heard the phrase: ‘Buy the worst house on the best street and fix it up’? This one’s not for the faint-hearted, but if you’re willing to take on a renovation project, you could save yourself thousands by choosing a property that needs some work. Whether you DIY and make YouTube your best friend, or rope in contractors to help, a fixer-upper could help you buy your first home sooner.
3. Move to a new area
We surveyed 1,000 aspiring first-time buyers across the UK and learned that over 58% would consider moving to a different part of the country to get on the property ladder.* If you’re up for a change of scene, broadening your search radius can be a great way to find the right property.
4. Save a bigger deposit
While this isn’t an easy option, saving a few extra thousands pounds on your deposit can save you tens of thousands in mortgage interest over time. Lenders calculate their mortgage interest rates based on ‘loan to value’ (LTV) – how much the property value is made up of the mortgage, compared to the deposit. For example, if you save a 5% deposit, your LTV ratio is 95%. LTV is calculated in bands of 5%, so every additional 5% you can put down as a deposit could unlock a slightly lower interest rate. So, if you’re very close to the next LTV band, it might be worth saving up a little more!
5. Take out a slightly longer mortgage term
You can make your mortgage repayments more affordable on a monthly basis by opting for a longer ‘mortgage term’ overall – how many years you’re borrowing over. For example, taking out a 31-year mortgage instead of a 30-year mortgage means you’re spreading your loan over a longer time period, which brings down the individual monthly cost of your repayments. However, this means you’ll pay more in interest over time and it’s important to check this aligns with your retirement plans.
6. Use a free mortgage broker – like Moneybox Mortgages
Some mortgage brokers will charge hundreds in unnecessary fees to find your mortgage, or push you to use a specific lender. Our mortgage broker service is completely free, so you’re immediately saving money! Moneybox mortgage brokers also compare thousands of mortgage deals across 90 lenders to find the right one for you.
Moneybox Mortgages is provided by Moneybox Mortgages Ltd.
Your home may be repossessed if you don’t keep up repayments on your mortgage.
7. Hire a van and do your own removals
Removals can cost thousands, depending on how many belongings you have or how far you’re moving. If you’re not afraid of some heavy lifting and driving, then packing up your stuff and moving can be an easy way to cut extra costs at the end of the home-buying process.
*Source: Moneybox FTBs Revisited Survey, Nat Rep, June 2024
