Will I ever own a home?
Ron Radway looks at problems facing first-time buyers but insists there’s help out there.
First-time buyers are a dying breed. They’ve fallen from 500,000 in 2000 to 200,000 in 2012 (according to the Council of Mortgage Lenders). Now, with the government reporting that the number of households privately renting has rocketed from 2.4 million in 2005 to 3.4 million in 2009, clearly there are issues to overcome.
Lenders are normally first in the firing line when the blame is apportioned, but in fairness to them they are doing their best under difficult conditions of their own.
Having been blamed for causing the mess in the first place by being too “imprudently generous”, (according to the deputy governor of the Bank of England), they can hardly be castigated for being circumspect in lending policy now.
But if you don’t want to live with Mum and Dad for the rest of your life (assuming they want you!) then is renting really the only option? Well, not necessarily. After all, with the private sector dominated by short-term tenancies, there is no security of tenure. Plus, it is invariably more expensive to rent than to buy, so it defies logic.
Government to the rescue?
The government in the shape of housing minister, Grant Shapps, is determined to: “Pull out all the stops to help those who want to take their first step onto the property ladder”, which include encouraging lenders to offer more mortgages to first-time buyers as well as building more homes and offering schemes such as the Help to Buy schemes.
So, what is the answer? Patently, it isn’t simple so practicality and personal responsibility must come to the fore. If you are determined to be a home owner, the bottom line is about ongoing affordability and raising a deposit.
Basically, it is a question of raising the deposit, and that requires personal determination and dedication-just as it did in the “good old days”. Without decrying the complications in saving for a deposit, in many ways it is easier now than in days of yore. Lenders are helping, with 10 per cent deposit deals being more commonplace along with greater numbers of approvals and even 5 per cent deposits being on the table, along with pragmatic guarantor schemes. Admittedly, saving for a deposit alongside all the other pressures on budget is not easy, but your first step should be to speak to a financial adviser who will help you organise your finances and prepare.
Arrange your mortgage
Make sure you have your financial arrangements sorted out before you start to look at properties and have looked into what mortgages deals you could afford. Estate agents will take you more seriously if they know you have a decision in principle.
Find the right solicitor
Find a solicitor who’s licensed in conveyancing on unbiased.co.uk. You can use the unbiased.co.uk search to find one who’s based near you. Check out their testimonials and qualifications before you commit.
Consider the seller
Do their plans fit with yours? If they want to move ASAP, does that fit with your circumstances? If they’re not planning to leave the property for a few months will you be able to find a temporary home?
Stay in contact
Make sure you communicate. Don’t jet off on your annual holiday or ignore correspondence related to the sale.
Better situation than you think
First-time buyers hold a strong position. Once you’ve secured a mortgage, estate agents should be keen to help you as you have none of the complications associated with selling a house and being part of a chain. If you do your homework, you could even bag a bargain.
It was never easy to get on the property ladder, but it can be done, it just needs tenacity and the right advice.
Find out more about stepping up to the ladder by speaking to an independent adviser.