How I bought my first home

How I Bought My First Home (and How You Can Too in 2025)

Buying your first home is one of the biggest milestones in life, but it can feel daunting—especially given the challenges many Millennials and Gen Z face in today’s housing market. As much as I wish the housing situation in most Western countries were easier, we have to work with the reality we’ve been dealt. This guide is a realistic, step-by-step approach based on my personal experience buying my first and second homes. While it won’t work for everyone, I believe it will resonate with many. Here’s how I did it—and how you can too.

Key Factors Lenders Look For

1. Household Income: Lenders typically allow you to borrow up to 4.5 times your household income.

2. Affordability: Even with sufficient income, you must pass affordability checks, which assess whether your fixed costs leave enough room for mortgage payments.

3. Credit Score: Your credit history plays a big role. Defaults and late payments could limit your lender options.

4. Deposit: You’ll need a deposit, often a minimum of 5% of the property’s value.

5. Legal and Associated Costs: These include solicitor fees, survey costs, and stamp duty, all of which are necessary to complete the transaction.

6. Finding the Right Property: The property must fit both your financial and personal needs.

The Two Biggest Hurdles: Income and Deposit

Household Income

Realistically, you need a household income of around £80,000 to buy a decent property in London (less in other regions) mostly due to the higher home prices, banks can typically lend you 4.5x your salary and it’s my belief you £500,000 or so to buy a decent home in the capital. If your income doesn’t meet this threshold, you may need to consider teaming up with someone—a sibling, partner, or even a parent—to pool resources.

If you’re in a lower-paying profession like teaching, you might face a tough choice: stick with your passion career or switch to a higher-paying field. For example, technology sales is one area where £40,000 starting salaries are common however you could start making £100,000 within a few years. (I’ve been in this field for 12 years, and I’ve written a guide on how to break into it.)

While saving is important, prioritizing income growth might make more sense if you’re earning significantly below this level. A higher income allows you to save faster and qualify for a larger mortgage, which can make all the difference in today’s market.

The Deposit

Saving for a deposit is often the biggest challenge. When I bought my first home in late 2018, my wife and I saved aggressively by cutting back on non-essentials: no holidays, minimal dining out, and a strict budget. We saved £1,500–£2,000 a month, which added up quickly. While this required sacrifices, it was worth it to achieve our goal. I should mention this in no way would have been possible if I wasn’t earning a decent amount in my technology sales career.

If you’re renting, consider moving further out to reduce costs, or even moving back home if that’s an option. Remember, you don’t need the full deposit when you start house hunting; from viewings to completion, you’ll likely have another 4–6 months to save. Aim to have at least 70% of your required deposit and associated costs before beginning your search.

5% Deposit Mortgages and Costs

A 5% deposit mortgage is a great option and one I used myself. Contrary to popular belief, these mortgages are not harder to secure than others, as long as you meet the lender’s criteria. Rates may be slightly higher (around 0.2–0.3% above those for 20% deposits), but the monthly payments are often still cheaper than rent, of course make sure that’s the case in your local area.

Fixing Your Credit Score

Late payments are a common issue that can prevent you from securing a mortgage. I faced this myself and had to resolve my credit issues before qualifying. If you have defaults or CCJs on your record, it’s still possible to get a mortgage, though you will pay a higher rate. For recent late payments, consider using templates or professional advice to negotiate with creditors. Repairing your credit should be a priority while saving for your deposit.

This is some information on how I removed late payments from my credit reports, I needed to do this before I bought, it took me ages, a lot of trial and error and I share my knowledge on this matter here

Is 2025 the Right Time to Buy?

In my opinion, 2025 is shaping up to be an excellent time to buy. With higher interest rates forcing some sellers to drop prices, you have a unique opportunity to negotiate discounts that weren’t possible in earlier years. Developers of new builds are also offering significant discounts to move inventory.

Here’s how to evaluate whether buying now makes sense for you:

• Compare the discounts you can negotiate now with the extra interest you’ll pay over the next few years. If the discount outweighs the interest, it’s a good time to buy.

• Consider how current mortgage payments compare to your rent. Even at higher interest rates, buying often builds equity, while rent does not.

For example:

• In 2022, a £500,000 property with a 5% deposit at a 3.5% interest rate would have cost £16,644 in annual interest.

• In 2025, you might buy the same property for £450,000 with a 5% deposit at a 5.5% interest rate, costing £23,484 in annual interest.

The higher interest adds £6,840 per year, but you’ve negotiated a £50,000 discount, which means you’d need rates to stay high for over seven years to come out worse.

Finding the Perfect Deal

The key to buying smart is finding the right seller, not necessarily the perfect property. Focus on motivated sellers—such as corporations or individuals facing financial pressure—who are more likely to negotiate.

Tips for Finding Deals

1. Research your target area thoroughly. Know the market as well as the estate agents do.

2. Look for properties that have been on the market the longest (use filters like "oldest first" on Rightmove and Zoopla).

3. Attend viewings and build relationships with estate agents. In private conversations, agents may share insights they can’t disclose officially.

4. Position yourself as a serious buyer: have your deposit, mortgage-in-principle, and timelines ready to go.

5. Consider properties that need minor renovations. These often come at a discount and allow you to build equity through improvements.

When I bought my first home, I negotiated 10% below the asking price on a property that was already discounted. By researching the area, asking the right questions, and being prepared, I was able to find a motivated seller and secure a great deal. The same approach worked for my second home, where I purchased 20% below market value.

Final Thoughts

Buying your first home is a significant undertaking, but with the right strategy, it’s achievable—even in today’s market. Focus on increasing your income, saving aggressively, fixing your credit, and finding the right seller. Remember, your first home doesn’t need to be your dream home—it’s a stepping stone.

I hope you found this guide helpful. If you’d like more tips on personal finance, buying homes, improving credit, and more, subscribe to my newsletter for weekly insights.