Welcome to Money Diaries, where we're tackling what might be the last taboo facing modern working women: money. This week, in partnership with the Financial Services Compensation Scheme (FSCS), we're looking at the contentious issue of home buying.
FSCS is a free service which automatically protects your money, from £1 up to £85,000, in UK banks, building societies and credit unions. They also have loads of helpful money tips and guides, including a future savings calculator, to help you find out how much money you could save (now and for your future!). Whatever you’re saving for, your money is safe with FSCS.
As everyone knows, we're in the middle of a housing crisis. Millennials are finding it harder than ever to get their feet on the property ladder. Many are struggling to save for a deposit, an increasing number are turning to their parents for help while the rest of us are losing huge amounts of money in exorbitant rent each month.
We decided to profile several different women who went about purchasing their house in different ways. This week, we're with a woman who purchased a shared-ownership house in Milton Keynes just after her 30th birthday. She saved much of the deposit herself and the rest was a gift from family that had been earmarked for her wedding which, in the end, didn't happen.
Age: 31 – I bought the house just after my 30th birthday.
Job: Personal Assistant
Salary: £25,500
House location and why? Milton Keynes – I was born here, my immediate family all still live here, I work in town and everyone I know is within a 10-minute drive, so I've never wanted to live elsewhere (although house prices are definitely cheaper in other towns!).
House type: Two-bedroom terraced house with a small garden, no garage but two allocated parking spots.
Mortgage type: Shared ownership – I own 40% of the house.
Did you buy this house by yourself or with a partner/friend? I bought by myself.
Why did you decide to buy the house? I had moved back in with my parents after a break-up and wanted to get back on my feet (it feels odd to be 30 and dating when your mum is still washing your socks for you), and I didn't want to keep throwing money at rental places. Plus, I liked the idea of being able to paint the walls and hang pictures in my home without having to ask permission from someone else.
Deposit: £16,500
How much was your deposit and where did it come from? My deposit was £10,000. On top of this, because my house is shared ownership, I paid a £6,500 premium, which is an extra cost paid directly to the previous owners for improvements made, like a new boiler and double glazed windows. It sounds like a lot but in my area, finding a decent home with a premium of less than £10,000 is pretty rare! Of the £16,500, I saved about a third of it myself (I also paid all my fees and legal costs), and the rest was a gift from my parents and grandparents, which was originally earmarked for a wedding that didn't happen.
How long had you been saving for and how did you manage to save? I lived at home with my parents for a year so I could save. I couldn't have put as much away while renting, and I was lucky that my parents only asked me to contribute a small amount each month to the increased bills and food costs of me living with them, which meant my outgoings were mostly for my car, my phone and my cat, who also moved home with me.
Mortgage: £225
Mortgage advisor fee: £0 – I had a consultation with a mortgage advisor but then applied for one myself online.
Mortgage booking fee: £0
Mortgage arrangement fee: £0 – the mortgage I picked didn't include an arrangement fee.
Mortgage valuation fee: £225
Find out more information about which mortgage is right for you, as well as how to apply for a mortgage with FSCS Money Means guides.
Buying Fees: £819
Stamp duty: Wasn't applicable.
Valuation fee: £0 – I just had the mortgage valuation as above.
Surveyor’s fee: £195 – I went for a slightly more detailed survey just in case, but it didn't turn up any problems.
Legal fees: £570 – I used an online conveyancing solicitor to keep costs down.
Electronic transfer fee: £54
Estate agent's fee: Not applicable for me.
Post-Buying Costs: £3,900
Moving costs: None! I had practically no furniture of my own except my bed, which my dad dismantled and drove over in his car. All my other possessions were books and clothes, which I piled into boxes and bags and moved over in stages. The last thing I moved in was my cat.
Work done on the house before moving in: As I was moving from my parents' house and in no rush, I was able to take a month once I got the keys to decorate the house and do some work to it. I tiled the kitchen floor with laminate tiles from B&Q (less than £100 total and I have some left over in case any need replacing). My family helped me paint the entire house – living room, kitchen, landing, spare room and bedroom (around £70, I bought off-brand paint). I had the carpets on the stairs, landing and two bedrooms replaced (around £400 including fitting). I picked a nice carpet for the bedroom, and a much cheaper one for the spare room, since I'll spend way less time in there. I also got the fusebox replaced, which was another £400, but worth doing – the electrician discovered my electric shower was wired up to my cooker (!) and corrected it for me.
Work done on the house after moving in: The biggest job that I had done after I moved in was the bathroom. The suite was old and a sort of yellowy cream colour (plus the inside of the loo was brown with limescale that just wouldn't shift) and I wanted to get the whole thing ripped out and replaced, but it would have been a huge expense right after moving and I wanted to put some more money aside for it instead of using the last of what I had. It ended up costing about £2,000 including appliances and fitting – I got a basic white suite, plain tiles, and painted the other walls myself.
Items bought for the house after moving in: I only had the bed previously mentioned to my name, so I furnished the entire house from scratch. I got some stuff secondhand; my Next dining table and chairs came from Facebook Marketplace (£150) and my fridge from Gumtree (£50). I bought my washer-dryer new from Argos (£290), and I got my sofa and armchair (£440) from Tesco Online – they look just like a DFS set that I liked, but were a third of the cost. I also got things like bookshelves, a TV cabinet and almost everything in my kitchen from Ikea, except my saucepans, which were hand-me-downs from my mum.
Ongoing Costs: £850
Insurance: I pay for my home and contents insurance once a year, and it's about £110 all-in.
Mail redirection: I didn't worry about this since I was moving from my parents' house which is a five-minute drive away, so I could just pop round to theirs and get any mail that didn't make it.
Council tax: £130
Bills: My mortgage is £354, my rent is £153. I pay £39 a month for gas and electric, £30 for my internet (I don't bother with a landline but I still have to pay for one), £21 for water, and £13 for my TV licence, although I'm considering getting rid of this – all I watch is Netflix.
Any additional costs? No, except for slowly adding to the furniture and general decor over the last year. I was in a great position as a first-time buyer, with no strings or a chain to worry about. I'm not looking forward to having to do it all differently if I ever want to move – the costs involved in selling as well as buying don't sound fun – but I'll cross that bridge when I come to it.
The Breakdown:
Deposit: £10,000 (plus £6,500)
Mortgage: £225
Buying Fees: £819
Post-buying Costs: £3,900
Ongoing Costs: £850
Total: £22,294
Whatever you’re saving or budgeting for, remember FSCS protects your money in UK banks, building societies and credit unions for free. Check your money is FSCS protected here.
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