Want to buy in 2025? Setting realistic goals as a first-time buyer

If you’re keen to buy your first home but are worried by all the headlines telling you property ownership is out of reach for most first-time buyers, the first thing to know is that it might not be – you just have to be realistic about what and where you can buy.

Here are 5 goals to set yourself that will get you on the right path to becoming a home owner:

1. Know your own finances

You probably have a fair idea of what you earn and spend every month, but it’s important to know exactly:

• How much money is coming in and going out each month, and when.
• What outgoings are financial commitments and necessities – e.g. rent, utilities, loan or credit card repayments, work travel costs – and how much you spend on other things, such as food, fuel, going out and holidays.
• If you have debt, who are your creditors and what is the current balance?
• The balance of any savings you have.

If you know you’re at the lower end of the earnings and savings spectrum, it’s worth finding out if parents or other family members might be prepared to help you buy. This doesn’t always mean that they have to offer you spare cash, there are mortgages that might enable you to buy with a guarantor.

Make sure your budget is clearly written down, ready to present to a mortgage broker or financial adviser.

2. Book an appointment to speak to a mortgage adviser

Online mortgage calculators can be very useful if you’re employed, have a fairly straightforward earnings structure and don’t have any debt or financial issues. But if, for example, you’re self-employed, have irregular income or perhaps have had some bad debt issues in the past, you may as well skip the online affordability research because it’s likely to give you a pessimistic picture.

By far the quickest way to get a reliable idea of how much you can borrow and what level of deposit funds you’re likely to need is to speak to a qualified mortgage broker, such as our partners at Mortgage Scout. They can talk through your options and usually also advise you on how to budget and save more, if needed – and you might be surprised at how much you can afford!

3. Understand your local market

Prices can be very different from one part of an area to another, even for similar properties. The biggest factor is supply versus demand - how rare is the property and how many people want to buy it – and that can change over time as trends come and go and more properties are built.

Your home is a significant investment, so you’ve got to think not only about what you’re paying today, but also how much equity you’re likely to gain between now and when you come to sell. Research suggests that 60% of FTBs move within five years, so you need to understand what type of property in which location is likely to be the most sensible financial choice now and in the future.

4. Understand your options and the compromises you might need to make

This is about looking at what you need and want, versus what you can afford, and understanding the pros and cons of your various options. For instance:

• What’s more important: space or location? At the same price point, the better the location, the smaller the property is likely to be.
• A new build might be slightly more expensive to buy than an older, second-hand property, but it’s likely to be much easier and cheaper to heat and will come with a 10-year building warranty.
• Buying a flat rather than a house might enable you to live in a better location, but you’re going to have a service charge to pay, so consider the cost over time.
• With shared ownership, you part-own, part-rent the property, but it can enable you to live in the size of home you need – and you have the option to buy more of it over time.

5. Put a plan and timescale in place

Once you’ve decided what kind of property is going to be the right first step on the ladder for you, you can put together a plan around what you need to do, and when.

So, if you need to save a bit more money for a deposit, work out where you can make savings and perhaps increase your income as well as what government support is available. This will help you work out how long it will take to hit your target.

To understand the market and find out about the different types of home in the area that might suit your needs and budget, come and chat to the team in your branch. We can show you what’s currently available and answer any questions you have about the house-hunting and buying process.