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First Time Buyers
17 July 2017
First Time Buyers
I am 22 years of age and would love to buy my own property.
Being a first-time buyer usually means forking out rent, saving for a deposit and playing catch-up with ever-rising house prices all at the same time!
London is the ideal place to buy a house or an apartment for me. It is a great place to live in, but it can be expensive if you are a first time buyer.
Not only are properties expensive to buy (average price in the borough of Redbridge is £446,581) but I will also need at least 20% deposit + stamp duty costs + legal fees on top of that.
Based on my salary, it would be impossible to apply for a mortgage based on the average property prices in London. My own research shows that there are two solutions for purchasing a property.
– Buy a property out of London as it is a lot cheaper, therefore, affordable for me.
– ‘Help to Buy Scheme’
The scheme requires a minimum 5% deposit of the property value with the Government offering an interest-free loan of a further 20%. The remaining 75% is covered by a standard mortgage.
As an example, if you want to buy a £200,000 property under the Equity Loan scheme, you would need a minimum deposit of £10,000 and to qualify for a £150,000 mortgage. The Government then provides an equity loan of £40,000.
Another option would be to buy jointly, either with friends or family. I think this is my preferred option, so far. 🙂