Saving For a New Home in 2022
The new year brings new priorities, and many of us might be thinking about making a jump onto the property ladder. The UK is in the midst of a housing boom since many people have decided to change their surroundings following the Covid pandemic that started in 2020. This has made the barriers to the market more difficult to overcome for first-time buyers. Any advice that can help goes a long way, so read on to find our tips on how to save for a new home in 2022.
Open a Lifetime ISA
One of the best and most effective saving strategies a first-time buyer can take is to open a Lifetime Instant Savings Account or LISA. These are set up by banks with good interest rates, specifically designed to help you get the money together for a deposit. This was brought in to replace the Help To Buy ISA a few years ago, but you can save up to £4,000 a year in it, and the government will top it up with a £1,000 bonus.
Use Online Tools
Being able to understand what you can afford and the deposit levels you want to aim to save for is very important. Many sources cite around 15-20% of the property’s value is required to get you on the property ladder, but it can vary depending on what type of home you are looking for. If you want to gain an understanding of what kind of mortgage you’ll be able to afford, be sure to check out some of the mortgage calculator tools from property experts.
Know Your Home
One of the most helpful exercises you can undertake on your property search is to have a clearly defined set of criteria for the type of home you’re looking for. If you set a property aggregator to the budget level you’re looking for, you might find that you’re overwhelmed by choice. Have a think about your specific requirements and pull a list of things you definitely need before starting your hunt properly. This will give you a clearer definition of what you need to save for.
Implement Smart Saving Habits
Trying to manage your disposable income is a tricky balance we all need to be content with, but getting a savings process right is essential if you want to have enough money for a mortgage deposit. This is even more important for first-time buyers, so any help will go a long way to helping you in the long term. Luckily, there are some really useful guides and methods published online that can help you here.
We hope this article has been helpful in showing you how to put money aside and meet the requirements for buying a home in 2022. It will require a lot of work and dedication, but the reward of owning your own home is incredibly valuable and will set you up in the long term. Create and savings plan that works for you and be realistic with your market expectations.