What are the Steps to Buying a House?

Buying a house is an exciting time for anyone, full of plans and ideas for what your future home will look like and what memories you will make while living there. The actual process can be a bit daunting, especially for first-time buyers. There is so much to learn as you go, but understanding each step can make your home-buying journey less stressful. Here is our comprehensive guide to help you navigate the process:

10 Steps to Buying Your First Home

4 Lower Janemount, one of our recently sold properties and a beautiful example of some of the unique homes to be found for sale in Cork City.

1. Assess Your Financial Situation and Begin Saving

Before you start looking for a home, it’s crucial to evaluate your finances and make a savings place. This first step will affect every additional step you take after - consistent savings are key to being approved for a mortgage, and your mortgage amount will impact what houses you can afford. Consider the following:

• Deposit: Whether you want to buy a new build or a second-hand home, you will need to pay a deposit that covers 10% of the overall cost. This money cannot come from your mortgage, as first-time buyers can only borrow up to 90% of the cost of the house. Saving for this deposit is the best way to show banks that you will be able to make your mortgage payments reliably.

• Existing Expenses: Do you have existing loans, maybe from a car or your wedding? Do you pay rent? How much do you spend each month on groceries, for your bills, your kids, or on clothes or nights out? Calculate all of your guaranteed expenses, then use that against your monthly pay to determine how much you can save each month. If you are renting, the amount you pay each month will be factored into your mortgage repayment capability but the banks will want to see evidence of additional savings as well so cut down on frivolous spending wherever you can and use that money towards your savings pot.

• Realistic Savings: When you apply for your mortgage, the bank will want to see at least six months of consistent savings towards your deposit. Keep your savings in a separate account and do not dip into it if at all possible - be careful when deciding your monthly saving amount that you do not overextend yourself and then end up needing to take money out of your savings to cover day-to-day expenses.

• Additional Costs: Factor in costs such as stamp duty, legal fees, and home insurance - these will need to be paid for separately from your mortgage, so keep them in mind when deciding how much you need to save.

• Professional Advice: There is absolutely no harm in speaking to a mortgage broker or a mortgage advisor from your bank early on in the process, while you are still saving, to make sure you are on the right path - in fact, we highly recommend that you do. They will be able to help you make the most of your budget and help you find ways to make you a more attractive applicant for your mortgage.

2. Check What Schemes and Grants You Are Eligible For

There are so many schemes available right now to help first-time buyers, and these can really make an impact on your ability to afford a home. Some are only available for new builds, while some can be used for second-hand homes. Just keep in mind that each will have its own rules, as well as maximum purchasing costs that they can be used for. Some of the available schemes include:

The kitchen of 1 West View, Military Hill, one of our previously sold properties.

• Help to Buy: One of the most helpful schemes, in our opinion, the Help to Buy (HTB) can be used towards the 10% deposit you need to pay on the house, and you can receive a maximum of €30,000. The amount you are eligible for will depend on your income tax and DIRT tax payments over the last four years. Eligible for new-builds only.

• First Home Scheme: This can be used to help bridge the gap between the mortgage amount you are approved for and the cost of the house you wish to buy. You need to apply for a mortgage through one of the participating banks, and the First Home Scheme company will receive a percentage of equity in your home. You can then choose to pay this off over time. Eligible for new builds or when purchasing the home you are currently renting.

• Local Authority Purchase and Renovation Loan: A government-back mortgage and loan that you can use to purchase a second-hand home that is derelict or uninhabitable, then use towards the renovations.

• Local Authority Home Loan: For those having issues securing a mortgage, the LAHL is a government-backed mortgage with lower rates. It can only be used to purchase second-hand homes.

• Affordable Housing: These new-build developments are built in partnership with local councils, and you purchase them through the council itself. Prices will vary based on your income, so check what developments are available or will become available through your local council's site. The prices on these homes are reduced, but in return, the council will own a percentage of the equity of the home that bridges the gap between the purchase price and the market value of the house.

These are only a portion of the schemes currently available, so to learn more we recommend checking out this Citizens Information, 'Help with buying a home.'

3. Get a Mortgage Approval in Principle

Securing a mortgage approval in principle (AIP) is an essential step, as the amount you are eligible to borrow will determine your final house budget - there is no point going to view a house that you end up falling in love with, but can't afford. Having AIP in place also demonstrates to agents and sellers that you are a serious buyer.

• Research Lenders: Compare different lenders and mortgage products. If you haven't already, now is a great time to go to a mortgage broker as they can help you get the best rates. Do some research yourself though, and look at other banks besides the one that you have your main accounts with - just because you bank with Bank of Ireland, for example, doesn't mean that you can't get a mortgage through AIB or PTSB. Each bank will have different rates, as well as different types of mortgages available - for example, many offer a Green Mortgage with better rates for homes that qualify with a high enough energy rating (BER).

• Gather Documentation: Prepare necessary documents, including proof of income, expenses, and identification. Your chosen lender or your mortgage provider can give you a full list of everything you will need but as a general rule you will want to have at least 6-months' worth of bank statements, proof of your savings, your most recent three payslips, and proof of your address. If you will be utilising any schemes like the Help to Buy or First Home Scheme, have documents showing your approval for these as well.

4. Start House Hunting

With your finances in order, it’s time to start looking for your new home. Now, you certainly can go to viewings before your AIP is in place, however, if you want to actually make a bid on a property you will need to have AIP first.

Along with houses, Powell Property also handle the sale of apartments like this one on Model Farm Road in Cork City that we sold in 2024.

• Online Listings: Use property websites like Daft.ie and MyHome.ie to explore available properties. You can set up alerts on these sites with all the details of what kind of property you are looking for, and then you will an email as soon as a property is listed that matches what you want.

• Window Shop with Estate Agents: Especially here in Cork, there are a plethora of estate agencies who handle sales. Almost all of them will have window displays with their current listings, so don't be shy about going for a walk around the city to see what everyone has. Here at Powell Property, we are always happy to answer any questions about our listed sales properties. Most agencies will also post their listings on their websites so have a browse there as well. You can find all of our currently available sales properties here.

• View Properties: Feel free to schedule a wide array of viewings at all kinds of different properties, to help you get an idea of what is out there and what kind of features you may want to prioritise having in your new home. You may decide you're not picky about location, so long as the garden is big enough - or perhaps you know you will be starting a family in a few years, so you need to get a home with enough bedrooms. If you want to buy a new build, ask the estate agent in charge of the development if they have a show house and when the next opening will be. If the development has already released its first few phases, you can even go to the estate and drive around to get a feel of the neighbourhood and see the outside of the houses in person. Register your interest through the website of any new developments that you are considering, and the agency in charge of selling them will contact you to answer any questions you have.

5. Make an Offer (Second-Hand House) or Put Down a Booking Deposit (New Build)

If you are purchasing second-hand, once you have found a property you like it’s time to make an offer. The house will be listed with an asking price, but you do not necessarily have to start by offering the asking price amount. The agent is obligated to present all offers to the current owner. Do keep in mind though that the agent selling the house is working on the instructions of the current owner, who may have a minimum purchase price that they are willing to accept.

• Research Comparable Sales: Look at similar properties in the area to gauge a fair offer price. When looking at comparable properties though, keep in mind there may be differences between the two houses like plot size, or how recently the interiors were decorated or renovated.

• Submit Your Offer: Contact the selling estate agent to find out if there have already been any offers made, as you will need to offer more than the current bid. Let them know you would like to place a bid as well and give them your bid amount. At Powell Property, we ask that all bids be made by email, as agents need to keep track of all offers on a property and we can do this best and most ethically by having a paper trail of every offer. You will need to give the selling agent your proof of AIP, or other proof of funds, at this time as well.

• Negotiation: Be prepared for counter-offers and negotiations. There may be other people also bidding on the property, or the owner may have a minimum amount in mind. If a bidding war begins between you and another potential buyer, it is very important to try to remain calm and keep your total budget in mind. The agent will keep you informed of all bids to see if you would like to counter. If the bidding goes on for some time, they may give a deadline for the last bids in order to wrap up the sale. Once your offer has been accepted, you will pay a booking deposit to the estate agent which will confirm that you are now 'Sale Agreed'. This booking deposit will then be deducted from the remaining 10% deposit - this will need to be paid later on.

If you are purchasing a new-build property you will need to stay in close contact with the estate agency in charge of selling the development. You will only be able to book one of the homes once a building phase is released, and with the current housing market in Cork (and across Ireland), they are often snapped up quickly once launched. Make sure the agents know you are ready to go with your booking deposit and AIP so that you are contacted quickly when they find out the launch date.

• Booking Deposit: When you are purchasing a new build, you do not have to put down the full 10% deposit in order to reserve the home. The exact amount of your booking deposit will depend on the developer who is building the estate, but the agency will be able to confirm that with you. Usually, you can expect the booking deposit to be between €5,000-€10,000. This money does need to come directly from you, you will not be able to utilise the Help to Buy Scheme at this stage until contracts are signed. The amount you pay towards the booking deposit will be subtracted from your total 10% deposit, though.

• Off-Plan Purchasing: Some new developments are only sold off-plans - this means the house is not built yet at the time you are putting down your deposit. You will be able to review the house plans as well as the overall estate plans with your agent, and you will use these to pick out which house you are reserving. If you are purchasing off-plan and the development you are buying in already has some houses built, we strongly recommend visiting the estate and walking around to get an idea of the size and quality of the homes. Not all new-builds are sold off-plan, this will depend primarily on the developer who is constructing the estate. Some will also offer show homes that you can visit before purchasing off-plan.

6. Hire a Solicitor

Engaging a solicitor is crucial for navigating the legal aspects of buying a home in Ireland. The conveyancing process can be long and complicated, and things rarely go perfectly smoothly, so finding the right solicitor is vital.

A beautiful, period home on Military Hill previously sold by Powell Property - Cork is full of historic properties of all price points. Some, like this, are ready to move in, but a good way to maximise your budget when looking for a historic house is to educate yourself on the various refurbishment and energy grants available that the property may qualify for. Your solicitor will be able to help you with any declarations needed for your application.

• Ask for Recommendations: Find a solicitor who is well-experienced in property transactions. If you have family and friends who have purchased a house previously, talk to them about which solicitor they used and what their experience with them was. Look at online reviews, search through social media groups dedicated to buying a house, anything you can to find people's real-world experiences.

• Conveyancing Process: Your solicitor will handle all the legal paperwork around transferring ownership of the house to you. This includes researching the property boundaries, ensuring there are no illegal extensions or other non-permitted changes to the structure, and more. This process is likely to be a bit more extensive or complicated with a second-hand home than with a new build, but both require extensive legwork.

• Legal Fees: These will vary by solicitor - some charge a flat rate for all property conveyancing, and some will charge a percentage of the overall purchase price of the home. Be sure to ask potential solicitors how they determine their rates when considering which firm to go with.

• New Builds: The agency selling your new build may ask for your solicitor's details at the time you put down the booking deposit - ask them in advance when they will need this, as you may need to engage a solicitor earlier on in the process if this is the case.

7. Conduct a Survey

Before drawing down your mortgage, you will need to have a survey done on your property.

• Engineers Survey: These are essential for second-home purchases. A qualified engineer will survey the property for any structural issues or boundary issues, ensuring that the home you are buying is safe and that you are getting all of the land associated with the home. They can uncover all kinds of nasty issues that may be hiding beneath the surface, and this may affect your final purchase price or even whether you decide to move forward with the sale or not.

• Snagging Survey: While an engineer survey is not usually necessary for a new-build home (though you can certainly get one if you'd like for peace of mind, or if you are purchasing a show house that was built several years before), a snagging survey will be vital. Snagging is when a qualified surveyor goes through the property with a fine-tooth comb, looking for any issues. These could be cosmetic, like peeling or chipped paint, or functional like scraping doors or leaking pipes. They will go over the property boundary as well, to ensure there are no issues with encroachment on your plot. They compile all the issues onto a list and give it to the developer to fix them all. It is best to have the snagging done before you officially close the sale, as this will give the developer extra motivation to get the snagging list completed quickly rather than delaying for months.

8. Finalize Your Mortgage

Once your offer is accepted, you’ll need to finalise and draw down your mortgage.

• Mortgage Valuation: The mortgage lender will require an independent valuation to be done on the property, whether it is a new build or a second-hand home. Each lender will have their own list of approved estate agents who can act as the valuers, and you will need to use one of them for the valuation. This just confirms to the bank that the house is in fact worth the amount that you are borrowing.

• Submit Final Application: Provide your lender with the necessary documentation for the final mortgage approval, they can advise what is needed but this will include details for the house you are buying and confirmation of any schemes you are utilising (Help to Buy, First Home, etc). You will also need to show proof of your mortgage protection, life insurance, etc. - again, your lender can give you a list of everything you will need so speak to them directly.

• Receive Mortgage Offer: Once all of your final paperwork is in and the mortgage lender has received all of the details of the property you are buying, you will be given a Letter of Offer. This is the final amount that the bank is willing to lend you - if there have been any changes to your circumstance since you received your AIP, please note this may affect your final offer amount. Be sure to carefully read all of the terms of your mortgage before signing any paperwork.

9. Exchange Contracts

Once the solicitors have finished all of the conveyancing, the contracts will be draw up. Your solicitor will review these with you carefully and advise on any recommended changes. Once you are happy to proceed, you can sign the paperwork.

• Deposit Payment: The remainder of your 10% deposit will be due for payment at this time. Remember this will be minus any previous booking deposit you made. So for example, if your 10% deposit is a total of €40,000 and you paid a booking fee of €5,000, you will only need to be the remaining €35,000. If you are buying new-build and using the Help to Buy Scheme, the money is sent directly to the developer.

• Completion Date: Once the contracts are ready and you have signed, your solicitor and the seller's solicitor can agree on a closing date - the day the sale is officially finalised.

10. Complete the Sale

When the sale closes, your mortgage will be drawn down and the funds are sent to the seller's solicitor.

The furnishings that are included in the sale of your new home can be negotiated during the contracts stage - but do ask the estate agent during the viewing if they know what the owner intends to leave behind or not. You may wish to negotiate that the house is left completely empty so that you have a fresh start, and do not have to worry about clearing out rooms or the attic while moving in.

• Register the Property: Your solicitor will register your ownership with the Land Registry and pay your Stamp Duty (you pay this to them as part of the solicitor's fees).

• Collect Keys: Possibly the most exciting step of the whole process! Once the sale has closed, contact the sales agent to confirm when the keys are available - in all likelihood, this will be on the same day as closing but just confirm with them to be sure.

• Move In: Start planning your move and enjoy settling into your new home! The moving process can be a whole, daunting process just on its own but don't forget to take a little bit of time to celebrate this amazing milestone and accomplishment in your life! Congratulations on your new home!

Conclusion

Buying a home involves careful planning and consideration. By being aware of the steps and doing proper research, you can navigate the process more smoothly and make informed decisions along the way. If you have any questions, please feel free to call us to speak with one of our expert agents who will be happy to answer any questions you have. Happy house hunting!