First-time buyer saved £27k deposit for three-bed house by cycling to work and ordering tap water at restaurants
But the first timer is not afraid of hard work, and took on two additional jobs on top of her day job so she could build a fund of £27,000.
Kimberley Burton, 28, works full-time as a dietitian at a hospital in Nottingham, but set up a a mobile beauty business in her spare time, training to specialise in eyebrows and eyelashes, working on evenings and weekends.
Like many first-time buyers Kimberley lived with her parents while saving to buy a home.
She paid just £80 a month towards living costs – but even so, she puts down saving up £27 to her top money saving skills, such as using Topcashback to shop earn cashback on everyday items.
She was also very strict with her spending, opting for tap water when she went ate out, and always opted for a two-for-one meal deal, and only got her hair cut once every two years.
It took Kimberley three years to save £27,000, maximising her Help To Buy ISA and cashing in on premium bond wins.
She used her £27,000 to put down a 15 per cent deposit on her first home in Sandiacre in Nottingham, which cost £171,000.
We caught up with Kimberley as part of the My First Home series to find out how she managed to take the first step onto the property ladder.
What’s your house like and how much did you pay for it?
I paid £171,000 for a three-bed mid-terraced house. This was right at the top end of my budget.
The property is actually an “upside-down” house with the living room and kitchen at street level. You then go downstairs to the bedrooms and bathroom – and the back garden.
I bought the property on my own, but now live here with my boyfriend.
One of the spare bedrooms has a kitchenette attached to it which is a little bit random and looks dated so we probably won't really use it but might come in handy one day. This room also has a little sink in it which is a nice touch as this will be the spare room for guests to sleep in.
Did you have any trouble getting it?
The property was priced at £170,000, but I ended up offering £1,000 over the asking price to get the owner to take it off the market.
When I started looking, I’d seen a couple of other places I’d liked, but there was fierce competition from other buyers for properties costing between £170,000 and £200,000, and places were selling really quickly.
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I was determined not to lose out to someone else, so decided to offer the extra £1,000 to secure it – though £1,000 was a lot of money to have to pay at a time when my finances were stretched to their limits.
How did you find it?
I spent a lot of time every day searching on Zoopla and Rightmove. I also signed up to the alerts from these sites which meant I got sent details of houses for sale within my budget.
My upper limit was £180,000 – though I knew I would only be able to afford a property at that price if I could negotiate the price down quite a bit.
How did you afford to buy a home?
I was able to save my deposit by being extremely disciplined and working three different jobs at the same time.
I also made big savings on rent by living at home with my parents until I was 28.
While I did contribute around £80 a month towards living costs, I saved around £600 a month by not having to pay rent. This made a big difference financially, but was a lot harder than having a place of my own.
I was also super-strict with my spending – rarely buying clothes, and only getting a haircut every two years. On the odd occasion when I went out for dinner, I always ordered tap water and took advantage of a deal, such as two-for-one on “Meerkat Meals” from Comparethemarket
I also cycled to work every day – come rain or shine – to save on the cost of bus fares and petrol. This probably saved me around £20 per week.
I got into saving mode and got very, very good at being frugal.
What size deposit did you pay and what mortgage did you get?
I bought my £171,000 home with a 15 per cent deposit – so paid £27,000. I then took out a mortgage for the remaining £144,000.
As this was very much at the top end of the amount I could borrow, based on my salary, I used a mortgage adviser to help me find a lender who would be willing to lend.
On the advice of the adviser, I applied to Halifax and got a two-year fixed-rate at a rate of 2.5 per cent over a term of 35 years. With this Halifax mortgage deal, I also got £1,000 cashback.
I now plan to overpay this mortgage each year to reduce the amount I owe more quickly.
Were there any issues?
One thing that really annoyed me was the fact my estate agent tried to tell me that I had to use the in-house firm of solicitors – and that there was no option for me to shop around.
But I knew from my own research that this wasn’t the case. So I did shop around, and got a slightly better deal from an independent solicitor.
How did you feel when you completed?
I felt a real mix of emotions. I was really excited, but also sad at the prospect of finally moving out of home after all that time – it was the end of an era.
At the same time, I was nervous at the thought of being committed to paying a mortgage for so many years, and anxious about having to cover all the bills.
How did you afford to furnish it?
I bought things such as the washing machine and vacuum cleaner from my savings, and also earnings I got from making purchases through Topcashback.
For example, I earned £45 cashback when I paid around £1,000 for electrical goods and white goods from Ao.com, and £300 cashback on a mattress which I bought from Dormeo.
I used these earnings to buy towels and bedding from Homesense. I was also fortunate to get a few bits and pieces from mum and dad, including pans, Tupperware and a Christmas tree.
Kimberley's tips for getting on the property ladder
I then bought the sofa – costing £1,700 – with 0 per cent finance (though I did manage to get 10 per cent off the price by haggling in-store).
But while I’ve managed to get quite a bit of the furniture I need, I still have some way to go.
My boyfriend and I are still sitting on the floor at mealtimes, as we don’t have a table – and we have to dry our clothes outside as we don’t have a tumble dryer.
We also need all sorts of little things, such as a cheese grater, baking trays, and pegs for the washing line.
At the same time, I keep seeing things I want to buy – like fruit bowls and sparkly decorations – but for now, I’ve got to focus on buying the essentials.
Does the place need much work?
On the whole, the property is in pretty good nick. There are certain things that aren’t to my taste – such as the bright green bathroom – but I can live with that for now.
The wiring in the house is also a bit random – there are loads of switches on the wall for each appliance.
But re-wiring is a big job which would cost a lot of money, so for now, I’m going to find a way to make it work as it is.
What was the most difficult part about buying a house?
For me, the hardest part was having to compromise on what I wanted in my first home.
I’d always dreamed of being able to buy a three-bed detached property near some lovely schools.
But a property of that type and size would have been way beyond budget – and I wouldn’t have been able to build a big enough deposit, or take out a big enough mortgage.
As a result, I’ve had to settle for a mid-terrace property with an unusual “upside-down” layout.
What’s the area like?
Initially, I wanted to find a property in Stapleford, but I couldn’t find a house within budget in that area.
The house I’ve bought is in the neighbouring town of Sandiacre – that’s another compromise I’ve had to make.
It’s not quite as close to the schools I like, but it’s still cycling distance from work which was important for me.
We also live about five minutes from a Lidl, and close to a couple of pubs, and the neighbourhood feels pretty welcoming.
When do you think you’ll move again?
I’d like to rent out this house in a few years and buy a property with my boyfriend. But we’re going to have to save hard again for another deposit – and for stamp duty, which is such a big expense.
Realistically, I don’t think I can look to move again for at least another three or four years.
What help is out there for first-time buyers?
Help to Buy Isa – It's a tax-free savings account where for every £200 you save, the Government will add an extra £50. But there's a maximum limit of £3,000 which is paid to your solicitor when you move.
Help to Buy equity loan – The Government will lend you up to 20 per cent of the home's value – or 40 per cent in London – after you've put down a five per cent deposit. The loan is on top of a normal mortgage but it can only be used to buy a new build property.
Lifetime Isa – This is another Government scheme that gives anyone aged 18 to 39 the chance to save tax-free and get a bonus of up to £32,000 towards their first home. You can save up to £4,000 a year and the Government will add 25 per cent on top.
Shared ownership – Co-owning with a housing association means you can buy a part of the property and pay rent on the remaining amount. You can buy anything from 25 to 75 per cent of the property but you're restricted to specific ones.
"First dibs" in London – London Mayor Sadiq Khan is working on a scheme that will restrict sales of all new-build homes in the capital up to £350,000 to UK buyers for three months before any overseas marketing can take place.
Starter Home Initiative – A Government scheme that will see 200,000 new-build homes in England sold to first-time buyers with a 20 per cent discount by 2020. To receive updates on the progress of these homes you can register your interest on the Starter Homes website.
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