Update: Help to buy Scheme latest sales results

The Government has just released the results of 2018 for its Help to Buy Scheme Since April 2013, some 210,964properties were bought with an equity loan. This means that there was a equivalent of 143 homes sold per day, that’s 1000 properties selling every week!

Help to Buy has now been operating over a six year period, first time buyers represent 81% of those buyers who have been helped onto the housing ladder by the Help to Buy Equity scheme. The Government scheme accounts for a total loan value of £11.7 billion since being set up by the government in April 2013. The overall value of properties sold through the initiative stands at a massive £54.48 billion and rising! 

London’s lead the equity loan value rising by 20% since 2016. Under the scheme the mean equity loan was £55,498 and the mean purchase price of a property bought was £258,223. From February 2016, in London the equity loan rose from 20% to 40%, which is great news for all of you first time buyers. From February 2016 until the end of 2018, there was a 12,511 property transactions in London and 10,635 were made with an equity loan higher than 20%. During the first quarter of 2019, HMRC transaction statistics potentially suggested that Help to Buy fuelled sales are still performing consistently, continuing the trend of the last 12 months. 

Did you know, that one in seven first time buyers benefits from the Help to Buy scheme. The Government scheme was highly successful in 2018, and will. Continue to stimulate the bottom of the housing ladder and indirectly support the whole of the UK’s property sector throughout the year. It is likely that the scheme will remain invaluable in supporting home buyers over the remining years of the scheme and will play a crucial role in helping to keep the housing market on an even page, during a period of uncertainty as a result of Brexit. 

Unfortunately the Government has made it clear that the Help to Buy will come to an end in 2023 and that it is looking to lenders and developers to come up with alternative products for first time buyers and second movers. It is vital that the Government and industry works together to ensure these buyers remain supported, it is likely that we could see private schemes coming to the market to help the market. There is good opportunity to buy now, renters should not hold back, as you can put down a deposit as little as 5%. To see what developments we have to offer, associated with Help to Buy, please visit our website (Hyperlink). 

Top tips for securing a mortgage

With the UK property market now entering its busiest period of the year, leading property finance specialists, we have put together some top tips for homebuyers when it comes to securing the best deal on a mortgage. While the affordability of mortgage products remains at almost record lows, there are still plenty of ways to make your mortgage even more cost-effective, although your broker might not always disclose these methods. While some tips will save you money, it really is a case of spending money to make money with some of the others. When combined they should place you in the best position when buying in the current market.

Deposit thresholds

More often than not, increasing your deposit by just a small amount can boost you into the next Loan to Value band, meaning a better rate and even potentially less onerous credit scores with lenders. Always work on 5% increments as these are where the best deals are for your price band.

Seek a no-fee mortgage broker

Pretty simple but many of us fail to do it. All brokers are paid commission on the product they sell you, but around 80% will also charge an additional fee – typically £500. May seem minute in the grand scheme of buying a house, but it all adds up.

Life cover

With the cost required to get on the ladder, many of us can be forgiven for skipping the add ons a broker may suggest. If there’s one cost you don’t want to skip on, it’s life cover. Understandably, many of us today can only get on the ladder with the help of our partners as a joint income is required. However, if the worst were to happen and illness or even death strikes, the lack of any form of protection cover can result in the whole deck of cards coming crashing down immediately. This is the last thing you need in this situation, so make sure your life cover is in place and up to date.

Don’t restrict your options

It’s common knowledge that your bank isn’t the best place to start as they only offer their rates and products. But you would be surprised as to how many brokers and advisers can only offer products from a restricted panel of lenders. As a customer, this means you are missing out on potentially the best deal for you so make sure your broker has access to the entire marketplace.

Get your personal details in order

Such a simple one, but if you’ve failed to update documents to your married name, or you aren’t registered to your current home address, the lender’s computer will literally say no as it won’t be able to find you. This is a shortcut route to having your application declined.

Electoral roll

Once your details are correctly registered, register for the electoral roll. You might not know it, but this has a huge bearing on the scoring system of lenders credit. If you aren’t registered it’s another minor little detail that can see you fall at the first hurdle of a mortgage application.

Forward your post

The £60 it costs to have your mail forwarded for a year will be the best money you’ve ever spent without even realising it. This doesn’t necessarily apply to your mortgage but it will save you money. All too often a client moves house and ended up with a default notice on their phone bill or credit card as they’ve not received the reminder and forgot to pay it.

Overpayments

Again, sounds obvious right? But many of us plod along without even considering it. If your mortgage product allows overpayments – make them! You would be surprised at how much even a small overpayment can make on a monthly basis when it comes to the total interest over the lifetime term of your mortgage.

Lock it in

We’re currently in the middle of an artificially low, interest rate cycle and mortgage product affordability is close to record lows. Great news but make sure you lock in on a fixed rate mortgage to make the best of the current climate. A longer term of a fixed five-year rate is probably the best option however a three year fixed might be a happy middle ground for many between a two and five-year product. However, be aware of any 10 year plus fixed rate products. The fee might be great but over the years we’ve seen best-laid plans fall by the wayside and clients are then hit with huge early exit fees if they need to move or pay their mortgage early.

Working overtime

Any overtime worked can be beneficial towards mortgage eligibility but try and ensure that this overtime is consistent as possible. If there are drastic swings in the hours worked, lenders will often work from the lowest figure when deciding your position in the market.

Credit score

If you’re looking to buy right now and your credit score is no good, then you’ve probably already had a few lenders say no. Your credit score is everything to a lender in this day and age and poor payment history or a low score will put you at a severe disadvantage from the offset. Do all you can to cultivate a healthy score starting now and as most lenders base their judgement on Experian, it’s worth the small investment.

95% mortgage rates plummet: is now the time to apply?

If you are struggling to build up a home deposit, then why not try the 95% mortgage scheme. The cost difference between 95% and 90% loan-to-value mortgages is shrinking. But is it wise to lock into a 95% mortgage deal or should you keep saving up for a larger deposit?

New data from Moneyfacts shows the gap between rates charged for two-year fixed 95% and 90% loan-to-value mortgages is falling, and is now at its narrowest since February 2013. Mortgage rates have become increasingly low, and with so many to choose from, now is definetly the time to buy. 

This is despite borrowers with the smallest deposits often being seen as more risky and recent reports suggesting uncertainties relating to the economy and Brexit are having an impact on the housing market. Currently in the market is a mortgage price war to attract first-time buyers with deposit as low as 5%, providers are minimising their rates to The narrowing rate gap has been driven by “healthy competition” by providers looking to attract people with a 5% deposit. 

The mortgage rate gap on 95% and 90% two-year fixed-rate mortgages was 0.65% in February 2019, down from 0.77% in January 2017, according to the latest Moneyfacts data. This is both because 95% mortgages are getting cheaper and 90% mortgages are growing more expensive. The average mortgage rate for 95% loan to value mortgages fell by 0.95% to 3.3% from October 2017 until today, while 90% loan to value mortgages rose 0.03% to 2.65% over the same period. Generally speaking, the higher the loan to value and therefore the smaller your deposit, the higher your interest rate will be. With a minimal deposit, the lender faces a greater risk if you default on your mortgage.

The counter-trend towards cheaper 95% deals may be explained by providers trying to compete in the first-time buyer market, to try and secure more loans from these customers. This is fantastic news for potential first-time buyers who are looking to find their first step onto the housing ladder. 

Top Ten 95% mortgages for first time buyers

 Maximum LTVInitial RateSubsequent Rate (SVR)Overall Cost for Comparison
Monmouthshire95% 2.54% fixed for 2 years5.24% Variable 4.9% APRC
Newcastle Building Society95% 5.54% Unit5.99% Variable5.1% APRC
Lloyds Bank95%2.65% fixed until 31 July 20214.24% Variable4.0% APRC
Barclays95%2.75% fixed until 30 April 20223.45% Variable3.2% APRC
HSBC95%2.89% fixed until 31 July 20214.19% Variable4.0% APRC
Halifax 95% 2.93% fixed until 31 May 20214.24% Variable 4.2% APRC
Post Office Money95%2.98% fixed until 31 May 20214.74% Variable 4.5% APRC
NatWest 95%3.08% fixed until 30 June 20214.34% Variable4.2% APRC
Halifax95% 3.09% fixed until 31 Jul 20214.24% Variable4.1% APRC
Lloyds Bank95%3.09% fixed until 21 Jul 20244.24% Variable3.7% APRC

Unlock the door to a home of your own with a Help to Buy ISA

The Help to Buy scheme continues to grab the headlines, with its success rate for getting first-time buyers onto the property ladder. A recent study from the Ministry of Housing, shows that almost half a million completions have taken place since 2013, with 430,000 of these completions made by the first-time buyer market.

There was a total of 494,108 completions, which have taken place using one or more of the governments Help to Buy schemes, over 93% of which took place outside of London. The average house price purchased through the schemes, was around the £200,000 mark. First-time buyers have now opened 1.4 million Help to Buy: ISAs offering government bonuses of up to £3,000 on top of their savings.

These figures highlight how invaluable the Help to Buy scheme has become, and how it will continue to support home buyers into the next decade. It has also helped prop up the new build sector and provided housebuilders with a solid target plan for the delivery of new homes. Demand will continue to grow for new build homes even though some questions arise around the price, value and borrowing requirements and affordability. Build quality and energy efficiency standards attached to new build properties continue to be a primary focus for the property developer sector. Help to Buy has certainly created a positive pathway for the growing numbers for first time buyers, housebuilders, lenders.

So how does it actually work?

Launched on April 1st, 2013 and available until 2023, help to buy is an equity loan scheme. Under the scheme, the buyer is only required to find 5% of the property value for a deposit. The government then lends you up to 20% of the value of the property in the form of an ‘equity loan’. The remaining balance can then be topped up through a mortgage. There’s no interest to pay on the equity loan for the first 5 years, after that the interest kicks in at 1.75%.

It’s open to both first-time buyers and home movers, but it is restricted to new build homes. From April 2021 onwards only first-time buyers will be able to apply. When you come to sell your home, the government will take back its 20% share. If you don’t sell, the money is due back after 25 years. The idea with the help to Buy equity loan is that, because you’re theoretically only borrowing 75% from the mortgage lender, payments will be lower than if you had used a 95% mortgage. Help to Buy is a great route to get onto the housing ladder, or to even upsize your house if you are wanting to start now. But you must be quick, as its not going to go on forever!

Everything you need to know about the first time buyers ‘market

First time buyers make up the biggest part of the property market in the UK for first time in 23 years, new research has found. Overall, the number of first time buyers reached 372,000 in 2018, accounting for the majority of home purchases for the first time since 1995, according to the latest Halifax first time buyer review. This is a rise of 2% in the last 12 months, continuing an upward trend over the last seven years. Although growth in 2018 was at a slower rate than 2017 when it was 7.6% and 2016 when it was 9%, first time buyers overall have increased by 92% from an all-time low of 192,300 in 2008.

First time buyers now account for just over 50% of all house purchases with a mortgage, an increase from 38% a decade ago, the research also shows. The average price paid for a typical first home has gone up by 39%, from £153,030 in 2008, to £212,473 in 2018, and the average deposit has increased by 57% from £21,133 to £33,252 over the same period.

Meanwhile, the average deposit put down by a first time buyer was 14% of the purchase price in 2008 at £21,366, jumping to 20% in 2009, the highest over the last decade. In 2018 the average deposit has come down to 15% of the purchase price, although the average property price has continued to increase. First time buyers are putting down an average deposit of £32,841, with those  in London putting down a higher £110,656, while those in Wales are paying the lowest average deposit of £16,449.

Terraced houses, closely followed by semi-detached properties have continued to be the first-time buyer’s home of choice over the past decade, making up 67% of mortgages for first homes in 2018. The average age of a first-time buyer in 2018 has remained at 31, two years older than a decade ago. In London it has grown from 31 to 33 since 2008, the oldest in the UK. The biggest increase in age was in Northern Ireland, up by three years from 28 to 31. New buyers coming on to the ladder are vital for the overall wellbeing of the UK housing market, and the continued growth in first time buyers shows healthy movement in this important area, despite a shortage of homes and the ongoing challenge of raising a deposit.

Last year was the first year that first time buyers accounted for the majority of the market since 1995, which shows that the factors reducing some of the associated costs, such as continued low mortgage rates and stamp duty, are supporting the increasing number of people taking their first step on to the property ladder. On a regional basis, while the numbers of first time buyers have increased nationally, the number of first time buyers in Scotland and Wales has fallen over the last year. London and the South East have seen the fastest rise in average price paid and deposit put down by first time buyers over the last five years. However, the average price paid in London grew only by 1.4% and the deposit fell by 1.4% over the last 12 months. This is in contrast to the 50% growth in first time buyer prices in London in the five years to 2018, compared to growth of 36% nationally.

At Fortitudo we strive in making housing assessable for everyone and create property ownership possible for first-time buyers, the majority of our developments are associated with governments schemes like Help-to-Buy. We believe in giving everyone a chance of owning their dream home.

First time buyers – how much of a deposit do you actually need to get onto the property ladder?

The average first-time buyer deposit was almost £4000 lower in the last financial year, according to a new government housing survey. The question is… could you have saved enough deposit to buy a property without even realising it?

The annual England housing survey revealed the typical deposit paid by first-time buyer in 2017/18 was £44,632, down from £48,591 the year before. This means its fallen by £3,956 or 8.14%. Fortitudo have taken a closer look at how first-time buyers have achieve their home ownership dreams and offers advice of how you can too get yourselves onto the property ladder.

Are things getting better for first-time buyers?

It is becoming increasingly more accessible to first time buyers to get onto the property ladder in the UK. There and now many different government schemes helping thousands to follow their dream of owning their own home. These schemes include Help to Buy equity loan, Shared Ownership and Help to Buy ISA. Furthering this, mortgage rates are falling and mortgage lender is becoming higher, with Banks including Lloyds lending 100% of the property purchase price.

How do first-time buyers buy their home?

More than half (56%) of first-time buyers bought their home jointly with a partner or spouse while 43% bought alone, according to a recent survey. Almost all first-time buyers in England (99%) had a repayment mortgage. Nearly half 46% had a mortgage of 30 years or more, 50% had a deal lasting 20-29 years, while a small proportion 3% had a 1-19 year mortgage. Borrowing for longer can help improve your mortgage chances. By spreading repayments beyond traditional 25 year period you can lower your monthly repayments which can help you meet strict affordability requirements.

First-time buyer have never had it so good

Brexit uncertainty Is making it easier for first-time buyers to get a good deal on a home. House prices have stagnated in some parts of the country, especially in London. The fewer number of buyers around has forced some sellers to accept offers below asking price. As well as taking advantage of the current ‘buyers’ market, first-time buyers can also benefit from historically low interest rates on their mortgage. This has led to monthly mortgage repayments being lower than rent in most of the UK.

Are you ready to buy your first home?

If you’ve started saving for a home and are itching to take that first step onto the property ladder make sure you check out our developments and secure your new home today with a reservation fee for as little £500 for Help to Buy users and £1000 for non-Help to Buy. To see what we have becoming available in 2019 head over to our website.

Now you can get a 100% mortgage for first-time buyers

Britain’s biggest lender Lloyds is to offer 100% mortgages to first-time buyers in return to lending last seen before the financial crash, but theres a catch. The bank will grant the loan on one condition, if the buyer has family that can stand behind the loan. Under the new Lloyds Bank “Lend a Hand” deal, a first-time buyer will be able to borrow up to £500,000 for a new home, without putting down a penny of deposit. The Lloyds move marks a major expansion into the first-time buyer market, as most other mainstream lenders demand a minimum deposit worth 5% of the property purchase price, although Barclays has offered a similar “family springboard “deal. Lloyds has priced the mortgages to uncut the Barclays offer.

Saving for a deposit is usually cited by first-time buyers as the biggest hurdle to home ownership. Lloyds said the average deposit put down by first-time buyers has climbed £33,211, and a staggering £110,182 in London. The Lloyds deal requires that a member of the family, such as a parent, grandparent or close relative, helps out. The bank will only grant the 100% mortgage if the family member puts a sum equal to 10% of the value of the property into a Lloyds saving account.

The deal is structured so that “Bank of Mum and Dad” can help out their children, yet still keep control of their cash savings that they will need later in life, Lloyds will pay what it described as a market-leading interest rate of 2.5% on the money deposited. Vim Maru, group director of Lloyds Banking Group, which also controls Halifax, said: “We are committed to lending £30bn to first-time buyers by 2020 as part of our pledge to help people and communities across Britain Prosper, and ‘Lend a Hand’ is one of the ways we will do this. Vim Maru continued to say “At the heart of this market leading product is helping address the biggest challenge first-time buyers face getting on to the property ladder, whilst rewarding loyal customers in a low-rate environment.

The Lloyds’ mortgage is structured as a three-year fixed rate deal priced at 2.99%. During the three-year period, the family member who has deposited the money with Lloyds cannot access their cash. Initially the deal is available in England and Wales only. The latest mortgage offering comes hard on the heels of a surge in 10-year fixes to beat Brexit uncertainty. Lenders such as First Direct have slashed interest rates on ultra-long term dates as low as 2.44% a year pegged for a decade. But these deals require buyers to put down large deposits, often as much as 40% of the value of the home being bought or re-mortgage.

Lloyds research found that buying their first home remains the number one life goal for people aged 18-35, but half have said that saving for a deposit is the biggest barrier. It also found that 41% of parents said they wanted to help their offspring on the property ladder, but were worried that they would need the money later in life.

5 top tips for buying a property in 2019

If you’ve set your sights on buying the house of your dreams in 2019, you’ll be pleased to hear that current buyers’ market conditions look set to continue for at least another six months. That doesn’t mean you should just sit back and wait for the perfect opportunity to come to you though.

1. Plan for a deposit, even if you don’t have to

According to Rawson Finance, lenders are granting 100% loans in certain circumstances, but smart buyers are putting down deposits anyway. Putting down a deposit is traditionally around 10% of the purchase price, this helps to minimise the risk your bank is taking by granting you a loan. This can have a significant effect not only on their likelihood of granting you finance, but also on the interest rate they’re willing to offer you. Buyers with deposits have been known to qualify for interest rates as much as 2.5% lower than those asking for 100% bonds. That can literally save you hundreds of pounds over the course of a 20 year loan, and turn your investment into a real winner. Once your savings pot is up and running, consider using an online affordability calculator to get an idea of how much you’ll be able to borrow based on your income and outgoings. Although this should be used as a guide, the information will help you focus on properties that are within your range.

2. Don’t forget about the prequalification’s

Before getting a mortgage, you will be credit checked, so now is the time to check your own credit report and ensure all information it contains is accurate and up-to-date. A good credit score can be the deciding factor in not only getting approved for the mortgage, but also the rate you are offered. Plan now to start paying down any outstanding debts, be sure not to miss any agreed payments on utility bills or mobile phone bills, and try to make more than the minimum repayment in the six months before you mortgage application. Competition for specific properties can be fierce at any time, particularly within the popular neighbourhoods and price bands. A good property, for a fair price, will often attract numerous competing offers, regardless of what the broader market is doing. The last thing you want is to find that perfect home and then lose out to another buyer simply because they took the time to get prequalified, and you didn’t.

3. Research affordability hot spots

You may have your heart set on a popular area, but so will many other buyers. On average, new buyers will end up moving 5.2 miles away from where they originally intended. Consider widening the net to make your budget go further, so you can but more space for your money. You could try searching in up and coming areas, which may become future property hotspots, rather than places where property prices have already increased a lot.

4. Play the stamp duty game

Those taking their first steps onto the property ladder have saved £2,300 on average, while those buying in London have seen almost double the discount with a typical saving £4,300. If first time buyers in England keep the costs of property below £300,000, there is no Stamp duty payable. And those buying a starter pad worth between £300,000 and £500,000 get a reduced bill, paying 5% on the remainder above the tax-free amount.

5. Help to Buy

Another popular method for first time buyers getting on the property ladder, is the Governments Help to Buy loan scheme, which will run until 2023. It’s available to homeowners looking to move as well as first time buyers, but only for new build homes. It gives an equity loan that can be used towards buying a property and means new buyers in England may need only 5% per cent deposit to get a good mortgage. With Help to Buy, even if you only have 5% per cent saved, you can get a well-priced mortgage because the Government is effectively guaranteeing the rest of the deposit. There are some limits on the price of the property you can buy and the loan must be used to buy your own home only, not by-to-let. Furthering this you have to get a repayment mortgage not an interest only mortgage.

First time buyers shrug off Brexit as Help to Buy government schemes, Stamp Duty exceptions and cheap mortgage deals boost home buying

A growing number of first-time buyers are shrugging off uncertainty surrounding Brexit and following their dreams, to owning their own home. Help to Buy schemes, stamp duty exemptions and cheap mortgage deals are giving new buyers the boost they need to get on that all-important property ladder. In November, there were 36,200 new first-time buyer mortgages completed marking 5.8% increase from the same point a year earlier UK, according to UK finance. The first-time buyer market is finally booming, with £6 billion lending providers to first time buyers in November alone.

The average loan taken out by first-time buyers in November was £142,000, up from £138,000 in November 2017 and the average first-time buyer is 30 years old with a household income of £42,000. The recent research into the market shows first-time buyer demand and actively has held up surprisingly well, with aspiring buyers clearly not losing the ambition to purchase their own home, despite the Brexit uncertainty. So it could actually be the best time for potential homeowners to make their move, given the strong appetite to lend in this part of the market and there is some very attractive pricing available, with very low interest rates.

These figures show Brexit uncertainty hasn’t prevented first-time buyers from grasping the opportunity to step foot on the housing ladder. The reality is that there are good deals to be had and many first-time buyers are taking advantage of government schemes such as Help to Buy. Introduced in 2013, Help to Buy programs allow first time home buyers to qualify for mortgage loans by making down payments as small as 5%.

Check out our top tips below, so you can join hundreds of first-time buyers jumping on the property ladder this year. 

1. Save long and hard for that deposit If you’re planning to buy a home, you’ll need to save for a deposit. – Open a Help to Buy ISA. As long as you‘re over the age of 16 and have a National Insurance number, you can take advantage of a tax-free savings account aimed specifically at buying your first home. The government will even give you a 25% bonus once you’ve made the purchase .

– Take advantage of stamp duty exception. Being a first-time buyer means the government will wave your tax for purchasing. As long as your property costs less than £300,000, you can save a significant amount. Don’t forget though, you’ll still need to pay solicitors, surveyors and financial advisors.

2. Seek professional financial help advice Buying a property can be very daunting for a first time buyer. It can become quite confusing, so it is highly recommended that you seek expert advice to help you through the process.

– Work out what you can afford to buy. Mortgage advisors are able to tell you how much you can borrow and therefore how much you’ll be able to spend. If you don’t find this out before viewing, you could be looking at properties out of your budget.

– Show vendors and estate agents that you’re ready to buy. If you’ve already understood your options, you’ll appear much more convincing to those selling and lending to you. That means you’ll be much more likely to close a deal when you find the right place for you. – Get certainty from your mortgage lender. Having all your finances set out by an advisor before you approach a lender will better your chance of them offering you a firm mortgage offer.

3. Decide on your monthly mortgage payments Your current situation will determine how much you can afford to pay on your mortgage.

– If your already renting, you will be used to paying out every month. It’s likely that your mortgage payments will be cheaper than what you’re currently paying. As an added bonus though, your payments will help you call the property your own.

– If your living with family, the costs might come as a shock. Its important to make sure you’ll have funds to manage a new monthly expenditure before you go ahead with your purchase.  

4. View lots of properties There’s a lot to consider when it comes to choosing your property. Having an idea of what your after will make your search more efficient.

– Decide what kind of home you would like. Whether it’s having a garden, or driveway, then you need to decide what priorities must be met. Be clear on whats most important to you, so you can shortlist properties accordingly and not waste any time.

– Prepare to be flexible. Its normal to change your preferences once you start visiting properties. Keep an open mind and don’t be deterred if you fall for a place that isnt quite what you were expecting.

– Thinking about renovating. For some, redecorating a property is a chance to make to a home. But you not have the funds or time to do this. Keep in mind the work that will need doing when you view.

5. Make an offer You’ve set priorities, sought financial advice and found your ideal home. Now its time to make an offer.

– Don’t be afraid to haggle. It’s nearly always the case that the price agreed is different from the price advertised. Negotiate with your estate agent and vendor so that you get the best deal possible.

Getting onto the property ladder in 2019

Buying a first home can be as daunting as it is exciting for first-time buyers but there are a number of simple steps people can take to prepare themselves and make the process as smooth as possible. 2019 could be the best year to get onto the property ladder, with some industry experts predicting that Brexit could cause house prices to drop further. So if getting onto the property ladder is your number-one new year’s resolution, read on for our step-by-step guide to the home-buying process, plus links for further information.

Saving for a deposit and other costs

Finding that all-important deposit will be the forefront in first-time buyers’ mind, so setting a savings goal to focus your efforts in the crucial first step in the process. Hopefully as a first time buyer, you’re saving into a Help to Buy ISA or Lifetime ISA, so that you can claim a government bonus of up to 25% when you buy. If you haven’t already, and you want to buy in the next few months, its worth opening a Help to Buy ISA before they’re withdrawn from the market in November 2019. Otherwise, you could opt for a lifetime ISA, but you need to have saved for a year to benefit from the bonus. As well as saving for a deposit, you need to think about the additional costs involved with buying a home, including surveying charges, moving costs and solicitor fees. There is also stamp duty to consider in some cases. First time buyers are exempt from stamp duty on properties up to £300,000 but there are still charges if properties are priced above this threshold, something which is particularly relevant to buyers in London.

Investigate mortgages

A mortgage is a home loan which you pay off gradually each month over the course of a set number of years, known as a mortgage term. Most mortgage lenders will offer you a maximum of between 3 and 4.5 times the combined annual incomes of you and any other people you’re buying with. Speaking to a mortgage broker could help as this will ensure you have access to a broad range of deals. Checking your credit score is a must before considering taking out a mortgage as this will be the deciding factor in whether you are accepted for the loan and what rate you are offered. You should always make sure all the information is accurate and up to date. You can enhance your credit score by paying off an outstanding debts and being meticulous about meeting agreed payments such as utility or mobile phone bills. Also ensue you are making more than the minimum payment on credit cards in the six months prior to your mortgage application.

Choosing the right property

According to the Post Office, three fifths of properties sold in 2018 were in areas affordable for first-time buyers. Understanding the rate at which a property sells in the area you are looking to buy could also help you negotiate on price and also help to plan for additional costs, which has created a rate of sale map to help buyers. Being prepared to compromise is also a vital quality in a successful first-time buyers and, as adjusting your expectations and having a flexible approach is important.

Research the area and start the house hunting

If you don’t already live in the area you’re thinking of buying in, try and stay there for a couple of nights to see if its definetly somewhere you want to live. Test your commute and check out what the atmosphere and noise levels are like at different times of day and night. For many people, the hunt begins with setting up search alerts on a portals such as Rightmove. But while this is a sensible place to start, it shouldn’t be where your research stops. You’ll need to register with estate agents and start going on real-life viewings to really get a feel for the types of homes available for your budget. Contacting local property developers in the area is a great way to get a first look at available property on the market, in the coming months. Buying property from developers not only cuts fees with estate agents, but also allows you to have your home finished personalised to you.

To see what developments we have to offer in 2019, head over to our website.