Through the beginning of 2019, houses prices rose at the sluggish rate of less than 1% several months in a row. With uncertainty over Brexit, UK house sales took a hit which has now all but leveled out, putting first time buyers in a good position to make a move. In fact, mortgage approvals have recently risen to the highest level in two years, which indicates that buyers should act soon before the market picks up again.
Securing a Low Mortgage Rate
With the housing marketing and interest rates taking a hit, mortgage rates are lower too. Now is a good time to act, but you can still follow some simple rules to get that rate even lower. As a first time buyer, you’ll need every penny.
- Your deposit and down payment — Saving up a bigger deposit can get you a sweeter a deal, and doing the work before is easier than trying to manage larger monthly mortgage payments.
- Get yourself a good broker — Consider an online broker like Mortgages from Habito to do proper research and get you the best deal.
- And of course, work on your credit score before the time comes to borrow.
Take Advantage of a Scheme
As difficult as it may be battling your way onto the property ladder, there’s actually a lot of help available to encourage first-time buyers to make their move. A Help to Buy ISA can facilitate raising a deposit with up to £3,000 per person available, meaning you and your partner could collect an extra £6,000 towards your house. Additionally, a government Helps to Buy scheme can cover the remaining part of your deposit with no interest for 5 years, which you’ll owe to the government on the sale of the house or completion of mortgage payments.
Other schemes that take the pressure off needing to raise so much money at once include Shared Ownership schemes, where you buy a share of your house and pay rent on the rest, and a forthcoming Starter Home scheme, where new builds can be purchased by first time buyers with a 20% discount, given that they are under £250,000 outside of London, or under £450,00 otherwise.
Don’t Take Risks
If things seem to be coming together, your finances are in check and you’ve got your eye on a property, don’t skip any important steps or rush into anything because the timing seems right. It is still all important to do a professional survey — not the same as a property report and valuation — to pick up any issues with the house that you need to know about and could cost you down the line, you may even be able to use these as leverage in negotiating a price. While a survey costs extra now, it may save you loads later.
And leave the legal work to the professionals, find a good conveyancer who can tie up all the legal issues and advise you where necessary in the buying process. There’s nothing worse than not knowing what is going on, but a good conveyancer can give you tips and assurance along the way.