While the private rental sector in the UK may have doubled in size since 2004, there’s evidence to suggest that it’s becoming easier for aspiring first-time buyers to step onto the property ladder.
After all, more first-time buyers took out mortgages in 2017 than in any year since the financial crisis, with 365,000 applications processed successfully. This represented a 7.4% increase when compared with 2016’s figures and highlights a clear trend in the market.
Buying your first home can provide a significant culture shock, however, as you’re suddenly responsible for buildings insurance and the cost of repairing broken boilers or white goods. In this article look at how you can manage these cost considerations and maintain a functional home.
Understand that the Key Lies with Insurance
If you’ve previously rented before buying your current home, you’ll need to take out additional insurance products.
As a renter, you’re only required to take out contents insurance, as your landlord assumes sole responsibility for insuring the building and any structural repairs.
As a home-owner, however, you’ll need to take out comprehensive insurance against your property, as this ensures that both the structure and its contents are protected in the event of fire or flood. This includes crucial fixtures such as your boiler and white goods, as if these are damaged by fire or an act of God you’ll be able to replace them directly.
But what if these appliances wear out or simply develop a fault? In this instance, you won’t be covered by standard home insurance, which is why you may need to protect each individual appliance with an extended warranty.
When you buy a new fridge or freezer, this will typically come with a manufacturers’ guarantee for up to 12 months. Some retailers will bolster this with an extended guarantee, which is included as part of the fee and may provide coverage for up to five years.
If this is not the case, you should consider investing in an extended warranty. This can be bought at the point of purchase, while it only requires you to make a nominal monthly repayment. The benefit of this is that your extended warranty will cover the cost of a repair once the other guarantees have expired, preventing you from having to find the necessary cash when the time comes.
Paid Bank Accounts may also Offer Home Cover
While some home insurance policies will cover the cost of boiler repairs up to a certain value, this cannot always be guaranteed.
However, some paid bank accounts also offer various types of additional home cover, including the cost of boiler repairs. Depending on your exact account and the amount that you pay in monthly maintenance charges, you may be able to cover repairs worth up to £500 and save huge sums of money in the process.
This is particularly important when dealing with boilers, as they’re notoriously expensive to replace and even basic repairs may require you to spend a great deal on new parts and labour.