By Nathan Craig
Buying a home is likely to be the largest purchase you make in your lifetime. It’s something that majority of us will never be able to save for and buy outright, we will rely on a large loan (mortgage) from a bank or building society, which is itself contingent on us having a secure income and we will be paying the loan off for much of our working lives. By any measure, purchasing a home is a big deal – which makes the whole process all the more daunting. It’s a pleasure to introduce you to Nathan Craig who gives us a bit more information about a growing trend aimed at supporting people throughout the process of purchasing a home. Have you ever head of a Home Buyers Club? Well, read on
Niaz Azad, Co-Founder of Millennial Money UK
Firstly, what are Home Buyers Clubs?
Home Buyers Clubs (“HBC”) are communities where prospective home buyers come together to share information and experiences about the home buying process. Often valuable information is revealed by members of the club and can prevent other members from making the same mistake or allow other members to benefit from this valuable knowledge.
Who are HBCs suitable for?
Anyone hoping to purchase a home or even thinking about purchasing a home in the future is suitable. HBCs can be specific to particular regions, so you can get great insider knowledge about a potential area, town or city you have been thinking of buying in. HBCs can be a great source of information before you heavily invest time into looking for properties in a particular area or help to filter out undesirable areas.
Are there specific clubs for first time buyers?
Yes, there are! Many HBCs are specific for one subset of buyers: first time buyers, young families, young professionals. There are some who specialise in helping first time buyers find affordable properties and others who specialise helping people buy in some of the UK’s most unaffordable areas such as London. Some HBCs even combine the two. It is down to you to find the right one for your needs.
What are the benefits?
1. Expertise: HBCs often have readily available data about the most attractive areas to buy property in while considering your non-negotiables (commuting time, affordability, local amenities, proximity to friends and family, etc.). The key is finding the right HBC for you.
2. Exclusive access to properties: Some HBCs are able to access exclusive properties as they partner with homebuilders, giving their audience the chance to secure properties at great prices before the same properties become available to the wider market.
3. Discounts: As HBCs often have hundreds of members, they can secure discounts throughout the home buying process if you choose to use their partner solicitors, mortgage brokers, valuers, etc.
4. Advice: Buying a home is one of the most expensive purchases people make in their lives; this makes it daunting. HBCs can help to advise and guide you through the complicated and intimidating process of buying a home.
5. Advice on building a deposit: Some HBCs give advice on how to save to reach your goals and what government assistance it might be worth looking into. There will undoubtedly be other members of the HBC who are at the same stage as you, who will also be there for advice and encouragement.
Sounds good but how do I find or join a HBC?
HBCs are growing in popularity meaning more are popping up however, they are not widely used in the UK yet. Some HBCs are informal such as internet forums, Facebook or WhatsApp groups and others are established businesses providing professional advice and support throughout the home buying process. If you choose a less sophisticated HBC, expect there to be less benefits than a more sophisticated one.
As with most things, searching on Google is the easiest way to find a good HBC for you once you have a rough idea as to where you would want to buy and what your non-negotiables are. You could even start an informal HBC with your friends.
How do I make the most of a HBC?
HBCs are powered by communication; the more open everyone is, the better it is for all. It is also important to have a think about what your non-negotiables are when looking for a potential property; that way you can filter your search. Do you only want to be a maximum of 10 mins walk from a station? Or perhaps you want to ensure you are not too far from your parents? Or you really want to live in a specific city? Joining the right HBC will help you to understand what is possible considering your financial position.
Things to consider:
1. Cost: What is the cost of the membership for the HBC? Is it a one-off fee or a monthly fee? If it is a one-off fee, you will not feel under pressure to purchase a property as soon as possible. If the fee is monthly, it will become quite expensive if you are not hoping to purchase right away.
2. Expertise: Will you be able to access 1:1 advice for your home buying journey? This is important as every home buying journey is different. You want advice that is unique to your specific situation.
3. Content: Is the HBC providing useful content that is relevant to you? If not, perhaps you have chosen the wrong club. The most effective HBCs can provide unique insights into what areas you should consider, while accounting for your non-negotiables and financial position.
4. What is the HBC offering? Is it value for money? And most importantly, is it right for you?