FIRST-TIME buyers Abbi Baker and boyfriend Dane Clark used a £50 budgeting rule and Excel spreadsheet to help save up to buy their £216,000 first home.
Legal apprentice Abbi, 24, and contracts manager Dane, 25, kept to a rule where they would only spend £50 a week – excluding bills – to help save roughly £800 a month each.
It meant they had to cut down on takeaways, saving £50 a month, and Abbi cut her Netflix subscription and gym membership, saving her £35 a month.
They needed to save as much as they could, as they set their sights on buying a house that needed work doing to it.
This is because the couple quickly discovered they were being priced out of the market when they began house hunting in October last year.
House prices surged during this time as Brits rushed to bag a home before the stamp duty holiday deadline ended in June this year.
It meant they could only afford a house in need of a makeover to get the family-sized property they were after in.
Abbi and Dane began to build up a “renovations saving pot”, tucking £400 of the £800 a month they were saving each into it.
They bought a run-down home for £216,500 in March this year, putting down a £22,000 deposit for it with an extra £15,000 on hand for the renovation.
But they were “gobsmacked” after receiving quotes from professionals stating they would have to fork out at least £80,000 on the renovation.
They've now roped in their dads to help them do up their home on the cheap – and they’re on track to save £40,000 as a result.
Abbi and Dane boosted their savings even further by living with their parents and paying a reduced rent to them.
Plus, Abbi's parents paid for their £1,300 legal fees and gave the couple £700 as a gift.
Although they bought their home in March, they're planning to move in later this month because renovation work is still ongoing.
We sat down with Abbi to see how they went from savers to homeowners for The Sun’s My First Home series.
Tell us about your house
It’s a three-bed, semi-detached house built in the 1960s in the West Midlands – and we’re in the middle of renovating it.
There’s one bathroom upstairs, and we’re turning the garage into a utility room – which will eventually have a toilet in.
We’re planning to knock down the walls and make our kitchen and dining room open plan. We’ll extend the kitchen area into a bit of the back garden too.
There’s a garden at the back of the house – we’ve ripped down the old rotten shed and gained an extra 5metres of space, which we’ll be turning into a patio area.
We’ve stripped back everything including the floors, walls, kitchen and bathroom.
Why did you decide on the area?
Although we’re not planning on having kids just yet, we wanted a family-sized home ready for when we do.
That meant we had to look in cheaper areas to get a house big enough for us.
We found that parts of the West Midlands, just outside of Birmingham, are a bit more affordable, so we looked at properties in these locations.
Where we live is two minutes down the road from my mum – so it’s great to live close to my family.
I work in Birmingham, and where I live has great train links into the city, making my commute easier.
How much did you pay for it?
We paid £216,500 for our house, and put down a 10% deposit for it, which was roughly £22,000.
We took out a £194,000, 40 year mortgage on a fixed rate for two years, and our repayments are £740 a month.
My dad covered the cost of our legal fees for the house, which racked up to £1,300.
How did you save for it?
We started saving in 2018 for a home, and it took us three years to raise enough money for a deposit and some cash to get us started on doing up our home.
Dane and I both opened a Lifestime ISA at this point, and started to save up as much money as we could per month into our accounts.
I would aim to save £800 a month into my account – roughly £400 would go into my Lifetime ISA to go towards the deposit, and £400 would go into a “savings pot” – a joint current account – for renovations.
Luckily we didn’t have to pay much in rent as we were living with our parents – I paid £100 a month and Dane paid £150.
When we had put an offer in for our house in March this year, my mum gave me a portion of the rent I had paid her back – £700 – which we put straight into our renovation savings pot.
To keep our saving on track over three years, me and Dane filled out all of our outgoings in a mega spreadsheet – we still use it now to log when bills are coming out.
We would put cash into our savings on the day we got our paychecks through, so we weren’t tempted to spend it.
After we had paid off all our monthly bills, we set ourselves a budgeting rule that we would only spend £50 a week.
That meant we had to plan exactly what we wanted to spend our money on.
If we overspent one week, we would have to make it up the following week and spend less.
I would often take pack lunches to work, as it costs around a fiver to buy it from the shop when you’re out.
My Netflix subscription and gym membership would cost me £35 a month, but I cancelled them which saved me £420 a year.
We also ditched pricey takeaways and made our own fakeaways instead, saving us £50 a month.
Our mortgage advisor was great, and got us £500 cashback on our mortgage by picking the best deal.
We put the money towards the renovation.
How are you cutting costs on your renovation?
We started viewing properties in October last year, but soon realised that the home we had in mind was way out of our budget.
Initially we were looking at new build properties, but we were house hunting around the time that the market went crazy.
People were rushing to beat the stamp duty holiday deadline, and house prices soared.
We were struggling to find a new property that was within our budget and big enough.
So we decided to ditch viewing new build properties, and instead take on a house that needed a bit of work.
After we got the keys for the house in June this year, we got professional builders in to give us a quote on how much it would cost to renovate.
We were gobsmacked when they said it would cost £80,000 – which is much more than what we can afford.
Luckily, my dad and Dane’s dad work in the trades, so they’re going to be renovating our house for free.
All we need to do is pay for the cost of materials and new units – which we’ve calculated will set us back around £40,000.
We’re so grateful that they’re doing the work for us – we never could have afforded to get it done otherwise.
We’re hoping to move in at the end of this month by getting the bedroom, bathroom and living room to a liveable standard.
We’ll then work on the kitchen and start making our house a proper home – we’re aiming to have it ready in time for Christmas next year.
In total we had £15,000 saved up in our renovations saving pot by the time we bought our house.
We’re still continuing to save every month to stump up the extra £25,000 needed to do up our home.
But we’ll be doing works in phases in order to spread out the cost and make it more manageable.
How are you affording to furnish it?
It was good timing when we bought our house.
My parents moved house just before Christmas and bought a lot of new furniture.
That meant they gave us the bits they didn't need anymore – including a sofa and a garden table and chairs.
There's no rush for us to buy furniture, as we haven't moved in yet.
We're planning on buying everything in phases to spread out the cost.
What’s your advice for other first time buyers?
It’s really helpful to have a spreadsheet to log your income, and all your outgoings every month.
A lot of the time we were shocked by what we would be spending when we listed it all – so it helps to see where you can make savings and stop spending unnecessarily.
It also helps when you’re keeping to a budget each month.
It’s also important to know what you’re getting yourself into with a renovation.
We’re lucky to have people around us who can guide us on this project but if you’re doing it by yourself then make sure you do your research and plan out your costs effectively.
This includes extra money put aside in case of emergencies, or if your renovation goes over budget – they usually do.
There would be nothing worse than getting half way through renovating the house and realising you don’t have enough left to finish it.
It’s definitely not for every first time buyer but we’re loving every minute so far.
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