First-time buyer saves £10k in three years by starting his own business – and now owns a £193k three-bed Manchester house


A TECH-buff from Manchester saved £10,000 for his first home by setting up his own business – and now he owns a £193,000 three-bed house.

James Taylor, 25, runs an SEO company that help businesses’ websites rank higher in Google, as well as working part-time for a marketing agency.

Robert Binder

James bought his three-bed house in Manchester with his girlfriend Emily[/caption]

Two years after turning his side-hustle into a limited company, James has moved into a new build house he bought with his 24-year-old graphic designer girlfriend Emily Marshall.

The business founder started out by taking on freelance marketing projects while he was at uni, earning between £50 and £200 a go, which he put straight into savings.

By the end of his course, he’d saved £10,000 on top of the savings he’d had from when he was a child, and continued to take on extra jobs even after he’d accepted a full-time work at an agency earning £24,000 a year.

Two years later, he turned the side-business into a limited company and went part-time at the agency so he could take on more work.

Robert Binder

The couple are among the first people to move in to the development which is still being built[/caption]

Robert Binder

The couple have only been living here for three weeks and are still making in their home[/caption]

When James and Emily found their dream home at Christmas last year, James knew he had seven months to save as much as he could on top of his now £15,000 savings.

He upped his game by approaching a company that builds websites setting up a referral deal for them to recommend his services to their clients.

Business kicked off and in six months he saved £5,000. Now James runs a team of three freelancers.

Emily and James put down a £13,510 deposit and used a 20 per cent Help to Buy equity loan too.

We caught up with James a few weeks after the couple had moved in for My First Home.

What’s your house like and when did you move in?

I bought my house with my girlfriend Emily at the end of July, so we’ve really only been here for about three weeks now. It all feels so mad and new.

It’s a three-bed house on a new build estate in Manchester. It feels like it’s in the middle of nowhere but it’s actually only 20minutes away from the town centre.

We’re both from Manchester so the location is ideal.

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The development isn’t big yet but it’s pretty much still a building site so I reckon it’s going to be massive. Our house is at the end of phase one.

It’s got two double bedrooms and a single one, which we’ve turned into a walk-in wardrobe.

We’ve bought a sofa-bed for the spare room and there’s also a desk in there so we can both use it for work.

How did you afford it?

The house cost us £193,000 and we put down a 7 per cent deposit. Between us that was £13,510 so £6,755 each.

We didn’t have to pay stamp duty because it was under the first-time buyer threshold but we did have to pay another few thousand pounds to cover solicitor and legal fees.

Robert Binder

The house has two double bedrooms and a single room[/caption]

Robert Binder

James made £10,000 by setting up his own SEO business[/caption]

We also used a 20 per cent Help to Buy equity loan to bring down the cost of our mortgage.

The loan was for £38,600 making our mortgage £140,890, which we took out over 25 years.

We’re currently fixed in to a two-year deal at 2.48 per cent and our repayments are £631 a month – that’s almost £300 a month less than what we were paying to rent a two-bed flat in the town centre.

But with the mortgage, the plan is to overpay when we can to try and pay it off quicker.

How did you save for the deposit?

I already had about £10,000 in savings when I set up my own business three years ago.

Robert Binder

They’ve turned the smaller, single bedroom into a walk in wardrobe[/caption]

I studied advertising and marketing at university and while I was studying I managed to pick up some freelance work on the side.

It was mainly helping out family and friends with advertising business and designing websites, and just getting projects through word of mouth.

I’d put all the money I earned doing that into savings, on top of savings I’d had from when I was a kid, so by the time I left uni I’d built up a pretty good nest egg.

James' tips on starting your own business

JAMES, who's the founder of Dispense Digital, shares his tips on what it takes to set up your own business:

Don’t get frustrated when things don’t happen immediately,

Be prepared to put in the effort – it will pay off in the end,

You’ve got to get used to being let down a lot at the start, but don’t give up,

Start small and accept every offer, even if you feel you’re better than the job. You’ve got to start somewhere,

Don’t feel bad about reaching out to other business because they might be able to help.

When I left, I started working full-time for an agency as a marketing consultant and continued to do some freelance gigs on the side to top up my savings.

I was earning £24,000 a year at my day job but then earning up to £500 over a weekend in freelance work.

And then, two years ago, I decided to turn the freelance work into a limited company, called Dispense Digital.

I specialise in SEO which basically means I help businesses’ websites to rank higher in Google.

It only cost me about £15 to register the company with HMRC and I got an accountant.

Robert Binder

Emily and James took out a Help to Buy loan to make their repayments shorter[/caption]

Robert Binder

They made the desk in the small room out of two IKEA cabinets and a bit of wood[/caption]

I built a website that cost me a £50 one-off payment and then around £10 for the hosting. After that, it’s all low-cost because at the end of the day, it only costs me a website and my time.

At first it was taking up so much of my time, evenings and weekends, which was a lot to manage on top of my day job.

I got into a routine with it though and after a year it was doing so well that I went part-time at the agency last year.

Robert Binder

The pair have lived in their new house for three weeks now[/caption]

Things really picked up at Christmas time last year, when me and Emily had decided that we’d had enough of renting and wanted to buy somewhere.

This development was the fourth one we’d seen and we decided that we liked it. At the time, the house was just a plot of land but after we put down the £500 holding fee, the developer said it would be built and ready to move in by the end of July.

I knew I had seven months to top up my by then £15,000 savings as much as I could.

I reached out to a company that builds websites and proposed to them that if they refer me to their clients, they can take a cut of the fee.

Robert Binder

Between them, they’ve managed to buy most of their furniture brand new[/caption]

Robert Binder

The couple didn’t have any of their own furniture from when they rented in central Manchester[/caption]

They went for it and then that’s when business really took off. It was too much for me to do on my own so I outsourced it to people I knew from my time working in the industry.

Each new project can cost around £100 to £200 depending on the service, but because it’s a subscription service, even getting one client on board can set you up for a few months.

Now I have a team of three freelancers working for me – it’s easier not having official employees because I don’t have to pay national insurance and it means I can pay what the agencies offer.

Over the six months before moving in, I made around £5,000 topping up my savings to £20,000.

Robert Binder

James turned his side-hustle into a limited company two years ago[/caption]

Robert Binder

The garden round the back is still in need of landscaping[/caption]

I don’t have to do too much now, mainly all of the admin. I’m still working 14 days a month for the agency though because running your own business is tough.

People never pay on time and I’d prefer to keep that regular salary coming in so I know I have something to rely on.

When saving for a house, I didn’t really have to give anything up either as the business topped up my earnings so I didn’t have to cut back on my normally spending either.

Was it hard to get a mortgage being self-employed?

It wasn’t actually because we used the Help to Buy equity loan and it brought the mortgage cost down, something the solicitor recommended by the developer advised us to do.

We could borrow enough with my part-time salary without having to rely on the self-employed side of my earnings.

Robert Binder

They put down a £13,510 deposit which worked out as £6,755 each[/caption]

Robert Binder

They didn’t have to pay stamp duty because they were under the first-time buyer threshold[/caption]

We haven’t thought too much about how we’ll pay off the loan but I imagine we’ll just stick it on the mortgage when we come to remortgage once the five-year interest-free period is up.

How did you afford to buy all of the furniture?

That’s partly why I wanted to make sure I earned enough before we bought somewhere because we didn’t have anything of our own from when we were renting.

We were lucky and were gifted a fridge-freezer from my mum and my Grandma bought us a washing machine, but everything we’ve bought, we’ve bought outright.

I think we’ve got everything now but as we’ve only just moved in so I’m guessing we’ll think of more things to fill it with.

Do you think you’ll be there long?

I don’t think this will be our forever home but I certainly feel like we’ll be here for the next five to ten years.

And to be honest, I’d be happy being in the same position in terms of work too really.

I really enjoy the freelance work but I also enjoy the regular payments that a salary gives.

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.

Help to Buy equity loan – The Government will lend you up to 20 per cent of the home’s value – or 40 per cent in London – after you’ve put down a five per cent 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 per cent 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 per cent 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 per cent discount by 2020. To receive updates on the progress of these homes you can register your interest on the Starter Homes website.

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