The United Kingdom housing market has seen a number of ups and downs( mainly downs) during the last couple of years. However it looks like the market has finally stabilised and many areas are beginning to see prices rise slightly. Information published by Zoopla in July reported that typical house prices rose by about £5,000 in 2011 with the typical home in the UK now priced at £216,534.
So if you are a first time buyer is it a good time to go into the market? Although there have been some increases prices are still less than they were at the same time a year ago. Predictions for 2011 and 2012 vary considerably depending on where they come from. The general consensus is prices will increase a little or continue to be flat. So if you are a first time buyer now is a great time to begin looking. The cost of housing is unlikely to fall and while any rises might be small they will only add to the cost of purchasing a house.
if you are entering the market for the first time here are a handful of tips to help you out.
Mortgage and Other Costs
Saving a deposit is among the biggest hurdles for most people and one reason why the housing market has been flat for the last couple of years. The times of loan providers being willing to give 100% mortgages have ended. These days you’ll need at least a 10% deposit if you want to get the best deals with the lowest rates of interest. However more 95% deals have started to appear in the last few months in particular for those who have excellent credit scores.
When you’re saving for your first home the deposit is just one of the numerous expenses you will have to take into account. You must also save for stamp duty, solicitor’s and surveyor’s charges and moving fees. Buying furniture and appliances for the home are other expenses to think about. Finally you will need to plan for bills that will be much larger than in shared accommodation or if you were living with parents.
New or Used Home?
With the low activity level in the property market there’s a large stock of unsold new houses available. You can get some terrific discounts and incentives that can help you save up to 10% from the asking price. New properties today are made to fantastic standards and will come with a 10 year guarantee for total peace of mind. Whilst a used home may be cheaper to buy it will be more expensive to run and maintain.
Shared Ownership
Shared ownership programs are becoming increasingly popular for first time buyers. With a shared ownership program you pay a mortgage on the share of the house you own and pay rent on the rest to a property association. Over time you increase the amount of the property you own. There are lots of shared ownership programs across the country and they can be a great way to get on the property ladder especially for key workers like nurses, teachers and police.
Another option you could think about is purchasing a house with a group of your friends. Although this can seem like a good option it can be fraught with pitfalls for the unwary. Ensure that you make use of a solicitor to draw up legally binding agreements. Use the What House? house price calculator to value your home.