Whether apartment hunting or buying a house, there are many ways to get onto the property ladder. However, just because these options are available doesn’t mean they are feasible, especially for millennials and younger generations who have seen inflation explode.
Still, there are a few lucky people under the age of 40 who have managed to get on the property ladder. Even if you think you’ll never own property, it’s still worth trying. After all, you’re going to age anyway, so you may as well own a home. So why is it so important to get on the property ladder, and what are the benefits?
Why Is It So Important to Get On the Property Ladder?
Getting on the property ladder is tough, but knowing why it’s so important to start your climb should help determine whether you can take the next big step forward.
Real Estate is a fantastic investment
Of all the things you can invest in, there are few better options than real estate. Compared to cryptocurrency or exciting (but uncertain) startups, you know that people will always need a place to live, yourself included. Therefore, even if you don’t plan on investing in multiple properties, your house will always be worth something. Of course, there is always the risk of a housing market crash, so it’s vital to keep up with the market forecasts to ensure you know your property’s price.
You don’t need to deal with landlords
One of the most frustrating aspects of renting a property is dealing with landlords. Depending on the terms of your lease, you may lack the permission or power to make changes or improvements immediately. Instead, you write to the landlord and wait for their permission to make repairs. The issue is that some faults can be catastrophic if not dealt with immediately, especially flooding or power outages. There is an increasing number of renters learning how to fight back against bad landlords to ensure a better balance that gives them more rights as a tenant, but this is not something you will have to worry about once you’re on the property ladder.
It will be easier to buy another property later
The hardest part of buying your first property is saving for a deposit or downpayment. If you’re buying a home by yourself, this could take years. But, once you have bought your first property, everything becomes much easier. You can use the sale of your home to buy another, especially if the price has increased so you can enjoy a larger, more comfortable home without needing to spend too much. There will still be other costs to consider like selling charges and real estate fees, but the hard part is done.
The Benefits Of Getting On the Property Ladder
Now you understand the importance of getting on the property ladder, you should also learn all about the benefits to give you a reason to explore your options and start saving.
You can build equity
The more you pay your mortgage, the more proof you have that this home is yours. Unlike renting a place where your monthly expenses go into the landlord’s pocket as they look to invest in yet another property, every monthly payment on your home builds equity. Furthermore, your mortgage payments are often cheaper than what you would be paying rent-wise (location dependent), so you have more money saved up for home improvements, emergencies, or treating yourself.
It makes the ladder easier to climb
Climbing the property ladder becomes easier with every house you buy. As a previous homeowner, you have evidence you can pay your mortgage and know how to deal with additional costs, as well as working with the best real estate agents for you. It may take some time once you’ve moved into your first property, but it’s useful to consider these tips when putting your house on the market so you can get the most out of it.
Your home will only increase in value
Aside from some catastrophic financial event, you can anticipate that your home is only going to increase in value. This happens because of inflation or improvements to the local area or even improvements you make to the house, such as renovating the kitchen or adding an extension. When you eventually sell your home (because you need more space or want to downsize after your kids leave) you should get more money than what you originally paid for it, meaning you have more options and should be able to afford another property.
There are Help to Buy Schemes available
While saving up for a deposit can seem arduous and not very fun, it is crucial for getting you on the property ladder. The good news is there are help-to-buy schemes for first-time buyers that make this deposit easier to achieve. Some government programs will match your savings (up to a certain limit) so you only need to save half of what you would have done in the past. For those hoping to get on the property ladder as soon as possible, it’s a great way to achieve your dream of property ownership.
You don’t need to stay in one place forever
Just because you’ve bought a home doesn’t mean you must stay there forever. Of course, you’ve put all this money down and want to make your first home as beautiful as possible. However, many people should consider their first home as a starter home. It might not be perfect, but it gets you on the property ladder, and that’s all you need right now. When it’s time to move out, you’ll have the evidence of homeownership and mortgage payments to make the process easier.
You have more freedom and security
The freedom and security you get from owning property are not something you can underestimate. You’re no longer worrying about making mistakes or causing accidental damage that could make the landlord decide to deny you your deposit return, even if you have to deal with them yourself. Ultimately, you have somewhere you can come back to every day. You can do whatever you want to do. You can raise your kids, bring in pets, decorate, and renovate however you like. As much as owning a home can be stressful, it’s also something that everyone strives for even besides getting on the property ladder, so embrace the opportunity when you get the chance.
It makes your retirement plan more efficient
Your pension may not be as dependable as you once thought, which could cause some discomfort as you get older and approach retirement age. Owning property and being high on the property ladder ensures a dependable nest egg for you to rely on. There may come a time when you have paid off your home entirely and even own other properties. With this, all the money coming in is entirely yours. You can also set up a reliable fund for your kids and grandkids, whether you want to leave the home to them as an inheritance or use funds to pay for college.
It isn’t easy to get on that first rung of the property ladder, but once you do, you’ll see how much easier it is to climb. There are still many issues associated with homeownership, such as increasing mortgage rates and needing to pay for all repairs and renovations yourself. Still, you have a place to live. Somewhere you can call yours, and as long as you keep up with your payments, no one can take that away from you.