4 Steps to Start Saving for a House
Buying a house is always exciting, but itβs never as easy as youβd hope it would be. There are a lot of things to take into consideration and your finances are the most important factor. When weβre young, we dream of the homes weβd like to live in as adults, but we still donβt have any concept of money. This is why we often end up disappointed as adults when we realize how much things actually cost. To make sure you can afford your new home and the mortgage that comes with it, itβs essential to start saving in time. Itβs going to be hard work, but these tips will help you get there as painlessly as possible.
1. Research the prices on the market

First thingβs first- if you want to start saving for your new house, youβll need to know the range of prices on the market. This will give you a good idea of the amount of money you need for the neighbourhood and the size of the house you want. If your budget is more important than the ideal location, you can always look for homes in cheaper neighbourhoods.
A good idea is to look for rising neighbourhoods, as the houses there are usually cheap now but have the potential of increasing their value over time. Look at this as an investment thatβs bound to pay off in the long run. You can even consider moving towns or moving to the suburbs if the house of your dream size is cheaper on that location.
2. Set up automatic bank transfers
If you want to have a sound financial strategy, youβll need to make the process automatic. Itβs much easier to complete your payments on time when you donβt have to do any of the work manually. When youβre as busy as yourself, it becomes hard to keep track of what bills you paid and what you didnβt, as well as what youβre still supposed to pay each month. Letβs face it, we all have plenty of other subscriptions we need to pay monthly on top of the utility bills.
Your account should have the option of setting up automatic transfers, so you wonβt have to even go to the bank to complete the process. Transferring the money is even easier if you have a high-yield savings account next to your regular one. This way, youβll never have to worry about spending the money you meant to save or having below the desired amount you wanted to save each month. The money will be transferred to your savings account automatically as soon as itβs in your account and youβll be one step closer to your dream home.
3. Find a good contractor
There are plenty of companies out there that could help you build your dream house. Your job is to do some research and find the best and most experienced home builders there are. A company thatβs worth your time will have a lot of options for you to choose from and will openly discuss the prices of the project with you. Donβt choose someone who keeps telling you that youβll talk about the price later, because companies like these usually stick you with hidden costs.
Also, itβs a good sign if the company wants to give you a free quote or if theyβre willing to put things on paper. Itβs a good idea to ask for discounts and what you can do to make things cheaper without sacrificing much of the quality, too. If youβre at the right place, the contractor will have an answer to all of your questions and be open to fitting the project into your budget.
4. Figure out your down payment
If you want to take out a mortgage, youβll need to figure out a down payment. In most cases, youβll need to give a 20% down payment when taking out a mortgage. This amount may seem high, but it helps you avoid paying extra on your mortgage every month, especially if youβre borrowing money from the private sector.
Private mortgage insurance can cost between 0.3% and 1.2% of the principal balance of the loan. This amount is paid to the lender of the monthly mortgage payment. However, most people find it impossible to save such an obscene amount of money for a down payment. In fact, the younger generation is able to save up to 8% on average. Thatβs why itβs important to start saving on time and be patient with when youβre going to buy your house or find a good down payment loan.
Conclusion
As you can see, itβs not impossible to save for your dream house. You have to be realistic about your options and what you can afford, but if you start saving on time, youβll have a lot more options to choose from. These tips will help you find the best home for your budget. Weβre confident youβll find the happiness you were looking for when you first move in and we just know youβll be able to save as much money as possible to make your dreams come true.