3 Things I Wish I’d Known Before Buying a House

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It’s been a couple of years now since I bought my first house. At the time, it was probably the most stressful thing I’ve ever done!

I’ve since had a baby, so that’s knocked the house-buying off the top spot. But, much like having a baby, you tend to forget all the pain and stress that comes along with a new home. A couple of years down the line, you’re all blissfully settled down in your new place and even ready to think about doing it all again… or maybe not just yet!

A friend of mine is about to embark on her first time buyer journey, and she asked if I’d got any tips to share. I’ve been reflecting on my home buying experience, which led to the idea for this post.

Here are 3 things I wish I’d known before buying a house.

The spending doesn’t stop once you’ve moved.

It goes without saying that my house is the most expensive thing I’ve ever bought. You probably also know you’ll have to spend money on surveyors, solicitors, bank fees and so on. But what I didn’t realise is how much money it costs just having a house!

We had a rude wake up to the realities of home ownership just months after moving, when our boiler conked out. And we couldn’t just call up the landlady to fix it as we would have previously – now it’s all on us. Not to mention the costs of decorating and refurbishing (who knew paint was so expensive?!)

So make sure you have a decent emergency fund, and try to keep some money back to spend on doing up your new place.

You’ll pay a crazy amount of interest

When you think about a mortgage, you imagine that you’re borrowing a sum of money to pay for your house, and you have to pay back some of that money each month, right? Wrong! 

In addition to the money you borrowed (the ‘capital’), you also have to pay interest on that money. In fact, in the early years, the monthly sum you pay will probably go mostly towards paying off interest – relatively little actually goes towards paying down your loan! Imagine my disappointment when I got my first annual mortgage statement and found that the amount had barely gone down at all.

Now, the reason this is important to know is because interest rates can go up as well as down. If the interest rate goes up, your monthly payment might go up too (if you are on a variable mortgage). You have to consider if you could afford this. 

The amount you pay each month is actually affected by two things: the interest rate, and the length of your mortgage term. So if you are struggling with the monthly payment, one option is to take a mortgage over a longer term (e.g. 30 years instead of the standard 25 years).

You can play around with a mortgage calculator like this one to see how these two factors might affect your monthly payment . 

Mortgage brokers are worth their weight in gold

I’m the sort of person who likes to do everything myself. I like to think of myself as a perfectionist; my husband calls me a control freak (rude!).

So I didn’t really like the idea of using a mortgage broker, because I assumed I would lose control of the process. Also, how could I trust that they were really finding the best deal for me, and not just recommending the bank that pays them the best?

Well, I did take the plunge and use a broker (I used this one), and I’m really glad I did. What I didn’t realise is that they can actually offer you better rates than you could find yourself, due to their special partnerships with the lenders. Not to mention the time you save!

I did do my own research as well, but I was unable to match the deal my broker found me. Next time I’ll just leave it up to them.

If you’re a home owner, what do you wish you’d known before you took the plunge? Let me know and I’ll pass your wisdom on to my friend!

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