Much has been written recently about the state of the property market. Inflated house prices, rising interest rates, and the cost-of-living crisis have all combined to paint a fairly bleak picture for homeowners.
However, opportunities still exist for those looking to get onto the property ladder, and there are many reasons to remain optimistic about the options currently available to first-time buyers.
Conveyancing Solicitors for First-Time Buyers
According to online financial comparison website Finder, the average age of a first-time buyer in the UK in 2022 was 34, a figure which has been creeping steadily upward over the years.
Finder’s research shows that in 2022, there were approximately 360,000 first-time buyers in the UK. The average first-time buyer deposit in the country was £62,470, around 21% of the average house price for a first-time buyer, which comes in at £302,010.
Figures are higher in London, where the average deposit for a first-time buyer in 2022 was £125,378, reflecting the higher price of real estate. In London in 2022, the average price of a first-time buyer’s property was £518,900.
These statistics suggest that there is still considerable activity in the first-time buyers’ market, a trend which looks set to continue, particularly if there is a fall in house prices that might create more entry-level opportunities for buyers.
So, if you are a first-time buyer, what do you need to know about taking your initial steps on the ladder?
In this article, our Residential Conveyancing team looks at the real estate market through the eyes of a first-time buyer and gives their top tips if you are considering buying your first home.
1. Have a look at the schemes available.
The government has introduced several schemes for first-time buyers to replace Help to Buy that closed to new applicants on 31 October 2022.
First Homes Scheme. The First Homes Scheme was launched in 2021 and is available to first-time buyers in England aged 18 or over. It allows purchasers a discount of 30%-50% when buying a new-build home. Not all new-build properties are part of the scheme, but the government has specified that a quarter of all affordable housing sold by developers must fall under the First Homes initiative and has pledged that a further 10,000 properties will be added to the First Homes scheme every year.
Mortgage Guarantee Scheme. The government-backed Mortgage Guarantee Scheme was launched in April 2021 and has already helped over 24,000 households. It was originally planned to close at the end of 2022 but has now been extended until the end of 2023. The scheme enables people to buy a property valued at up to £600,000 with a 5% deposit.
Lifetime Individual Savings Account. With a Lifetime ISA, you can earn a 25% bonus from the government on your savings up to a maximum of £1,000 a year. You must be 18 or over but under 40 to open a Lifetime ISA, and you can put in up to £4,000 each year until you’re 50. You can only withdraw the money to buy your first home or wait until you reach the age of 60 when you can use it for other purposes.
Shared Ownership. Although Shared Ownership is designed to help people buy their first home, the scheme is available to anyone if they meet the eligibility criteria. When you buy a home through shared ownership, you buy a share of between 10% and 75% of the home’s total market value and pay rent to the landlord on the rest.
2. Research mortgage offers and repayment rates.
There are many different sorts of mortgages on the market, and which one is right for you depends on several factors, such as:
- How big your deposit is.
- The type of property you are buying.
- Your income, credit commitments and spending habits.
- Whether you want a repayment or interest-only mortgage.
- How long you want to ‘fix’ a rate for.
Lenders are increasingly offering high loan-to-value mortgages which means you no longer need a huge deposit to buy a property, but it is critical that you research thoroughly the terms and conditions of all mortgage offers before committing to a deal.
3. Get a Survey.
It can often be tempting to look for ways to save money in the short term when faced with the considerable expense of buying a property.
However, not having your house or flat surveyed by a professional chartered property surveyor is likely to be counterproductive and could lead to much more expense further down the line. A property survey will alert you to any potential defects, issues, or possible risks to the structural integrity of the building. It can also be used to negotiate the purchase price of the property for sale.
4. Go to see different sorts of properties.
Once you have narrowed down the area you want to move to, it is worth viewing different types of properties in your desired location to see what best suits your needs.
New build homes offer some advantages over older properties. Not only do you avoid the conveyancing chain and they are less likely to need any work or maintenance, but they are also usually more energy efficient, which means you might qualify for a green mortgage. Several schemes, such as Deposit Unlock, are also available exclusively to people looking to purchase new build homes.
However, conveyancing on a new build home is often more challenging than on an older property, with tighter time scales, more documentation and additional searches to undertake. An experienced residential property conveyancer will be able to tell you about the additional issues you may face.
Seeing the different options on offer, and weighing up the various pros and cons, will ensure that you take an informed decision as to what sort of property to buy.
5. Beware of any hidden costs.
In addition to the house purchase price and your monthly mortgage repayments, there are many other different costs that you have to factor in when buying a home. These can include:
- Survey costs.
- Solicitor fees.
- Mortgage arrangement and valuation fees.
- Removal costs.
- Buildings insurance.
- Initial furnishing and decorating costs.
- Stamp Duty.
- Utility, council tax, and other bills.
If you purchase a flat in a communal building, there might also be additional costs to look out for, such as service charges and ground rent, which you will also need to allow for in your budget.
6. Use an experienced conveyancing solicitor.
Seeking the advice of a specialist conveyancing solicitor will ensure the transfer of title is legal and your transaction runs smoothly. Property lawyers are experienced in drafting contracts, undertaking searches and making sure that all the relevant documentation is provided.
A good conveyancing solicitor will keep you informed of the progress of your house purchase and liaise with the other parties involved, making sure everything is in place for a successful completion.
Residential Conveyancing Solicitors Near Me
At Larcomes, our specialist team of residential property solicitors have extensive experience helping first-time buyers take their first step onto the property ladder and will ensure your transaction is carried out as smoothly and cost-effectively as possible.
We make sure the necessary legal steps are taken to buy or sell your property and that the matter is completed quickly and efficiently whilst ensuring you are kept up to date through the legal process.
We recognise that buying or selling your property can be a stressful experience and our goal is to remove the stress through the provision of a friendly and quality responsive service.
If you are a first-time buyer looking for a reliable and professional conveyancing solicitor, give Larcomes a call today. You can reach us on 023 9244 8100 for our Portsmouth office or 023 9224 6666 for our Waterlooville office.
Property Law Solicitors
Our specialist residential property department provides a full range of legal services which include:
- Freehold and Leasehold Sale and Purchase.
- Mortgages and Re-mortgages.
- Shared ownership.
Larcomes always offer a personal approach and once you instruct us to deal with your matter, you will be assigned a specific person who will deal with your transaction and liaise with you as the matter progresses.
Conveyancing, perhaps more than any other area of law, needs regular contact between the client, the solicitor and the estate agent to minimise delays and ease your stress.
You can be confident that if you instruct Larcomes and your specific solicitor is unavailable for any reason, there will always be another team member who can help you deal with your file straight away.
To find out more about our specialist conveyancing law team, please click here.
Please note that this article is not intended as legal or professional advice. It is for general guidance only, and updates to the law may have changed since it was published.