We bought £282k first-home by cutting back on holidays and eating out
MARRIED couple Erik and Tania Jakovenko, both 30, managed to buy their £282,000 two-bedroom terraced house outside Brighton by cutting back on holidays and eating out.
The first-time buyers managed to bag the property in May 2018 after putting down a deposit of £30,000, and they've since been joined there by three-month-old son Niko.
The property was 55 miles away from where they initially planned to buy in London, but Erik convinced his boss to let him work from home to save on commuting costs.
After Erik and Tania got married in April 2017, the couple realised they’d spent a large chunk of their savings on their wedding, which cost just under £20,000.
So in order to speed up the process of finally getting on the property ladder, Erik and Tania stopped going on holiday altogether.
They also cut back on dinners out, cooked more food at home, and brought packed lunches to work.
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Erik told The Sun: “If we did go out, we were sensible with our spending because I know how easy it is to spend £100 a week on drinks if you go out with your mates.
“After a month, you realise that’s about £400 a month that could just go towards the deposit, so we were very frugal when it came to things like that.”
By also moving in with Erik’s mum for two years, it meant they could save £1,500 altogether each month.
At the time, project developer Erik earned around £35,000 a year while Tania was paid £25,000.
We caught up with Erik for The Sun’s My First Home series.
What’s your home like?
It’s a terraced house in Burgess Hill, a town 20-minutes from Brighton.
The property is spread over two floors with two bedrooms and two bathrooms.
The bedrooms and one bathroom are on the top floor, and everything else is on the ground floor.
The house was built in the 1950s, so it wasn’t particularly modern when we moved in.
The previous owners had done quite a lot of renovations, but we decided to do up the entire place and pretty much start again.
There is still quite a bit of building work going on after two years.
How much did you pay for it?
We put down an offer for £282,000 in February 2018 and got the keys in May 2018.
The property was actually on the market for £285,000, but we got it down around £3,000.
It was quite easy to haggle because it'd been on the market for quite a bit of time.
We initially put down an offer of under £280,000, but we agreed to pay £282,000 as long as they left the Rangemaster cooker and fridge, which were really nice.
We took out a mortgage over 35 years and now pay £900 in repayments a month.
How did you save up for the deposit?
To save up for our deposit, we didn’t go on any holidays at all.
And if we did go out, we were quite savvy with our spending because I know that if you go out with your mates, you can easily spend £100 a week just on drinks.
And you realise after a month that's about £400 that could just go towards a deposit.
So we were very frugal when it came to things like that, and I rarely bought any new clothes.
We also always tried to cook at home and take packed lunches to work.
What help is out there for first-time buyers?
GETTING on the property ladder can feel like a daunting task but there are schemes out there to help first-time buyers have their own home.
Help to Buy Isa – It's a tax-free savings account where for every £200 you save, the Government will add an extra £50. But there's a maximum limit of £3,000 which is paid to your solicitor when you move. These accounts have now closed to new applicants but those who already hold one have until November 2029 to use it.
Help to Buy equity loan – The Government will lend you up to 20% of the home's value – or 40% in London – after you've put down a 5% deposit. The loan is on top of a normal mortgage but it can only be used to buy a new build property.
Lifetime Isa – This is another Government scheme that gives anyone aged 18 to 39 the chance to save tax-free and get a bonus of up to £32,000 towards their first home. You can save up to £4,000 a year and the Government will add 25% on top.
Shared ownership – Co-owning with a housing association means you can buy a part of the property and pay rent on the remaining amount. You can buy anything from 25% to 75% of the property but you're restricted to specific ones.
"First dibs" in London – London Mayor Sadiq Khan is working on a scheme that will restrict sales of all new-build homes in the capital up to £350,000 to UK buyers for three months before any overseas marketing can take place.
Starter Home Initiative – A Government scheme that will see 200,000 new-build homes in England sold to first-time buyers with a 20% discount by 2020. To receive updates on the progress of these homes you can register your interest on the Starter Homes website.
Tania and I also moved in with my mum for about two years, which meant we saved the £950 we previously spent on rent each month.
Luckily, we didn’t have to pay for things like bills, so the only thing we’d do more of was cooking.
We would probably have bought our first home earlier but we also mostly paid for our own wedding two years prior to this.
A chunk of the money that we’d saved up went towards the wedding, which cost just under £20,000, so then we had to start again.
We did open a Help to Buy Isa but we weren’t eligible for the bonus because our property cost more than the maximum threshold outside London of £250,000.
But the rates were quite good at the time – around 2% – so we still got an extra £150 to £200 a year in interest, so it was still worth having it even though we didn’t get the top-up.
Overall, I always saved around £1,000 a month and Tania would put away around £500.
We had very average salaries. At the time I was earning about £35,000 a year, while Tania earned 25,000.
How did you decide on the area?
We were initially looking in Dartford or Erith outside London but then for what we could afford, we just thought no way.
It’s just not worth the money, so we decided to kind of venture out further.
Obviously that's a bit tougher, because you then have to decide whether the house move is going to be worth the cost of commuting.
The main factors we looked at were the commute time to work, crime levels in the area, flood risk, and the changes to house prices in the last ten years in an area.
Tania is on maternity leave now, but at the time she was working in Farringdon in London and there’s a direct train from where we live to there. So it was very easy for her to commute.
At the time, I also spoke to my employer and we agreed that I could become a remote worker once we moved in so I only needed to commute into London once a week.
We miss our friends in London but we also have quite a lot of mates that are kind of scattered around.
Some of our close friends are only in the next town over so it's not so bad.
Burgess Hill is like a hotspot that we found that is only an hour away. The train ticket wasn’t overly expensive, so that’s what we’re happy with.
From the beginning, the mindset we had was the current house we purchased was never meant as the "it" house, since our priority was to get on the property ladder, and have some equity behind us towards our next house.
We don’t have a location in mind, but most likely either in Burgess Hill or somewhere in Hampshire.
This means we will be looking to move in around seven to ten years.
Did you encounter any problems with the purchase?
Not really, the issues came after we bought the house and moved in.
There weren’t any major issues that made us think "oh god, why did we buy this house?", but there were unexpected costs when we realised how old things were.
We thought we were going to focus on cosmetic changes, but then we realised the entire house had to get rewired.
Because even if the electrics were fine at the time, they weren’t going to be up to standard after a few years.
Similarly with the plumbing, we started to break down boxes and found random pipes that went to nowhere.
How have you renovated your house?
We’ve changed pretty much everything. The only things we didn’t touch were the conservatory and the garage.
We’ve ripped out the floors, knocked down a few walls and closed up the fireplace.
The bathrooms have completely changed as well. The one on the top floor has been completely retiled, and the bottom one I’m currently in the process of retiling.
To save money, we started to learn how to do a lot of things ourselves.
For example, we put down the solid hardwood floor in the living room ourselves with the help of YouTube tutorials.
The one thing that we realised you don’t want to cheap out on is tools.
It won't always be to a professional level but the standard that you're going to be happy with and it will last.
The only thing I’d always recommend for people not to touch is electrics and core plumbing anyway.
If it goes wrong, it could be a danger to you and can really screw things up and your insurance as well.
We’ve so far spent around £10,000 on renovating and decorating the place.
There were definitely moments where it was very stressful, but I wouldn’t say I regret it thanks to the experience I’ve gained.
I reckon we’ve saved around £15,000 by renovating the house ourselves rather than hire someone to do it for us.
How did you afford to furnish it?
We’re still buying stuff but the things we did get were either from my parents or we bought it second-hand on websites such as Gumtree and Facebook Marketplace.
We also used eBay for new items, as some retailers including Currys PC World sell things for less than what they usually cost on their own websites.
We also got in the habit of using cashback website TopCashback for bills and appliances.
When I took out a new broadband deal, I’d get quite a decent amount of cashback of around £100.
But then when you get that cashback, you shouldn’t just automatically spend it on booze or whatever.
What I'd do is use that again to spend on appliances, for example, so it's kind of like a circle of cashback.
I would get it for the utilities, but then I would spend the money towards buying a bigger appliance, like a washing machine, which was about £300 to £400.
You’d get around £30 to £40 in cashback, which gives you that extra bit of cash.
What advice would you give to other first-time buyers?
I’d advise people to spend time researching the cost of the actual mortgage versus the cost of your commute to work.
The amount of time I spent on the National Rail website looking at different stations and season tickets is just ridiculous. But by doing it you can figure out which areas you want.
If you’re confused by the process, take the time to sit down, read through everything and if you don’t understand, you can always ask.
Our estate agent Cornells had a mortgage advisor who pretty much explained everything for us.
Also, if you’re thinking of purchasing a house but you’re not really sure about how old it is, it could be a good idea to get a full Rics survey.
It’s a bit pricey, we paid around £500, but it’s worth it if it's a property that you really, really want but you're just not really sure.
That's how we kind of found out about some of the problems, such as the plumbing and electric, so that was very helpful.
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