From kickstarting your budget to collecting your keys, planning your finances is one of the most important steps to buying your dream home.

Buying your first home is a noteworthy accomplishment, but navigating the property market can be overwhelming. You may have questions like, how much can I borrow? Or how do I save, especially when I'm paying rent? You may also be wondering about your deposit and some of the government supports available to you.

If you're not quite sure where to begin, Which Mortgage have you covered. In this article, we provide savvy financial tips for first-time buyers, to make your journey to homeownership simpler.

 

Saving for a Deposit - The Essentials

Begin your journey by saving for your first home, whether it is for a deposit, furniture or improving your financial health ahead of submitting your mortgage application.

Here are some essential tips for saving:

1. Create a Budget: Start by looking at your current financial circumstances and create a detailed budget. Your budget should take account of your income, expenses, and your savings goals. This exercise will enable you to identify areas where you can cut back and allocate more funds towards your deposit. Once you have a clear understanding of how much money goes in and out of your account each month, you'll be able to come up with an amount you can save every month and determine how long it will take you to reach your savings goal.
2. Open a Savings Account: Consider opening a separate savings account dedicated to your deposit. Separating your savings and current accounts will prevent you from dipping into your savings and it will make it easier for you to track your progress.
3. Make your Savings Automatic: Set up a monthly standing order from your current account to your savings account so that you keep your savings consistent. If there are months when you can afford to add a little more to your savings, then you can just top it up, but having a set amount every month that you know you can save is advisable.
4. Cut Unnecessary Costs: Identity non-essential expenses that you can cut or reduce. This could include dining out less, buying fewer takeaway coffees, and cancelling unused or unnecessary subscriptions. If you are renting, if possible, consider living with family while you are saving. This will allow you to save on rent and free up some much-needed money.
5. Increase your Savings: This may not be possible for everyone but it is worth exploring opportunities to boost your income. You could take on some freelance work, turn a hobby into a 'side-hustle', or sell items you no longer need or use. The savings you generate could go a long way to increasing your purchasing power.
6. Explore Government Supports: There are government supports available which provide financial assistance and incentives to first-time buyers. Take the time to research these supports and understand how you can leverage them to save and potentially reduce how much you spend on purchasing your first home.

The First Home Scheme

Launched in July 2022, the First Home Scheme (FHS) assists first-time buyers purchase newly built homes. The FHS provides financial support and bridges the gap between your deposit and mortgage, and the price of your new home.

First-time buyers can receive up to 30% of the market value of a new home and in return, the government take temporary ownership in the property. Eligibility criteria under the FHS can vary, so it is important to research the details and consult with a mortgage broker if you have any additional questions.

The FHS also offers support known as the Tenant Home Purchase Scheme (THPS), which is available to tenants who have received a Notice of Termination and seek to purchase their rental property from their landlord. Where tenants have insufficient funds to purchase their rental home when they combine their mortgage and deposit, they may seek to bridge the funding gap by availing of the THPS, subject to meeting the qualifying criteria for the scheme.

 

Help to Buy Scheme

The Help to Buy (HTB) Scheme is designed to assist buyers in buying newly built or self-built homes. Under the HTB, first-time buyers can claim a tax refund of up to 10% of the property's value up to €30,000.

You can avail of both the HTB and the FHS. When doing so, you will only be eligible to receive up to 20% from the FHS.

 

While the prospect of buying your first home may seem daunting, meticulous financial planning and researching available government supports can significantly ease the process.

Adopt sound financial habits and let Which Mortgage support you throughout your mortgage journey, from getting mortgage-ready to securing the keys to your dream home. Book an appointment with us today.