The UK has long been considered a nation of homeowners — but the number of Brits buying property has dropped significantly within the past decade. While 55% of 25 to 34-year-olds were recorded as being on the property ladder ten years ago, this percentage now stands at just 38%. The majority of housing experts have cited the steep rise in house prices as the main cause.
But if you’re looking to buy property, don’t despair. As with most things, saving could be the best solution. And contrary to popular belief, you really can save for a mortgage while renting. Here, we explore how.
Is It Really Possible To Save For A Mortgage While Renting?
Look for cheaper rent
If you want to save money for a mortgage, look — once again — to the rental market. By securing cheaper rental accommodation, you stand to increase your savings in the long term. So, why not look for a living space without added luxuries? If you’re building a mortgage fund, do you really need a garden while you’re renting, for example? Or that spare room? Or can you forgo those luxuries until you secure your own home?
Become energy efficient
Want an easy way to save fast? Becoming energy efficient may sound costly and time-consuming, but it generally isn’t — and no, it doesn’t always involve buying a new central heating system.
You can find out the energy efficiency level of your rented property by looking at its EPC (Energy Performance Certificate). Because most UK boilers are fitted with condensing boilers, they’re already fairly efficient anyway — but you (or rather your landlord) could boost this effect by making some improvements to both the boiler and the property.
The key ones include switching to a lower carbon fuel and adding insulation or draught-proofing where needed.
If you feel that your landlord may need some convincing, try to underline how it will benefit the property and, in turn, them. After all, they’ll be able to sell it as an energy-efficient home – and this, in turn, could boost their future income from renters.
Cut out luxuries
Let’s face it, most of us are guilty of having bought things we don’t need at some point or other in our lives. As fun as luxury purchases are, they take a hefty chunk out of our finances.
This is particularly bad if we’re trying to save for a mortgage. So, once you’ve lowered the necessary costs we’ve talked about above, how about cutting out the unnecessary ones? Do you regularly indulge in a take-out coffee? Are you a fan of frequent nights out or costly activities?
Whatever your guilty luxury is, scrap it and swap it for something that’s either free or cheaper. That weekly yoga session? Trade it for a YouTube video! Restaurant visits? Make your own delicious meal at home — put on your favourite music, light a few candles and you’ll have your very own fancy dining experience. Doing away with pricey products doesn’t have to be boring!
Explore funding alternatives
When it comes to building a mortgage fund, saving is the best option. But if you feel you could benefit from financial assistance, you may want to explore different funding alternatives. Would any of your family be able to help, for example? They might be happy to help you get on to the property ladder, as they’ll know how tough it can be and they’ll care about your financial security.
Despite what some people may say, you really can save for a mortgage while renting — all it takes is a few money-savvy tricks. Now that you know what they are, you can start building your mortgage fund more effectively.