What Is A First-Time Buyer?

The first step onto the property ladder is one of the most exciting moments in someone’s life. Buying a house for the first time is an incredible feeling. Getting to the point where you own your first home is the tricky part.

But buying a house for a first-time buyer doesn’t have to be stressful or complicated. With the right advice and guidance, you can save money and time. If you want to find out what benefits you are entitled to as a first-time buyer a mortgage adviser can guide you:

As a first-time buyer, you do not have to pay stamp duty on the first £300 000 of a house valued up to £500 000. As well as this there are a number of schemes that can help keep your costs down. This is why it is important to know if you qualify as a first-time buyer, so you can take advantage of these benefits.

First-Time Buyer Explained?

You will qualify as a first-time buyer if you have never owned a residential property before, in the UK or abroad. This extends to both freeholds and leaseholds. Simple.

So, if you qualify as a first-time buyer what are some of the benefits and schemes you are entitled to:

Help to Buy Scheme

If you are a first-time buyer with a small deposit you could be eligible to use a Help to Buy scheme. Also known as a Help to Buy mortgage. The Help to Buy scheme is an equity loan where the government lends first-time buyers funds to buy a new-build home. As long as the purchase price is under £600 000.

This scheme allows you to borrow 20% of the value of the house you’re purchasing interest-free for five years. Provided you have a minimum 5% deposit. In London, you can borrow up to 40% of the property’s value. The loan borrowed from the government is repaid alongside the mortgage across a set-term.

first time buyers image with coffee mug
Conceptual hand writing showing First Time Buyers. Business photo text demonstrating buying house or flat who has not previously owned Mug of Hot Coffee with Blank Color Speech Bubble Steam icon

Shared Ownership

In the current financial climate, many people cannot afford a deposit that qualifies them for a mortgage. One way around this is to consider shared ownership when buying a house. This means you buy a share in a house from the landlord and pay rent on the remaining share.

Although this means you have mortgage payments alongside rent this can work out cheaper than a conventional mortgage. And importantly for first-time buyers, it means you don’t have to put down a large deposit to secure a mortgage. As the value of the property you’re purchasing is reduced because you are only buying a share in the house.

Rent to Own

The Rent to Buy scheme allows tenants who rent their homes from their local council to buy their home outright at a discount. The discount varies depending on the property and where you live in the UK.

To find the right mortgage solution for you, as a first-time buyer, it is crucial you contact a mortgage adviser:

Guarantor Mortgages

Assistance is you are struggling to raise a deposit.

A guarantor mortgage is a way of securing a mortgage when you do not have the required deposit. A Guarantor someone who agrees to act as a mortgage guarantor for you, the Guarantor commits to covering the repayments if you fail to do so.

Sometimes this type of Mortgage is called a family assisted mortgage, a guarantor mortgage is a way for parents (or grandparents) to help their family on to the property ladder.

The guarantor will not own a share of the house, and they won’t be named on the deeds. Being a guarantor simply means signing a legal agreement to cover mortgage repayments if the actual borrower falls behind.

Contact Us Today

Get in touch with one of our friendly and expert mortgage advisers today to find the right mortgage for you. As a first-time buyer, buying a house is completely new.

A mortgage adviser can guide you through the process and ensure you end up with the best value mortgage for your circumstances. Give us a call today on 01604 300033. Or fill in the enquiry form on our contact page today.


Residential Property Review – January 2020

Residential Property Review – January 2020

Our monthly residential market review is intended to provide background to recent developments in property markets, as well as to give an indication of how some key issues could impact in the future.

Experts’ predictions for 2020 – ‘cautiously optimistic’

The Conservatives’ general election win and increased certainty on the direction of Brexit have led property experts to predict growing confidence in the housing market in 2020. However, their optimism is cautious, according to researchers at Savills who have predicted a 1% rise. The Royal Institution of Chartered Surveyors gave a more confident prediction of 2%.

Nitesh Patel, Yorkshire Building Society’s strategic economist, commented: “Sales to first-time buyers are buoyant and now account for around half of all house purchases. A strong jobs market and low mortgage rates are likely to support the market, but concerns around affordability may limit the number of people wanting to move home.

Britain’s most affordable commuter towns revealed

On 2 January, Rail fares increased by an average 2.7% across the board, meaning that commuters could be paying up to £132 more for their season tickets this year.

Your location can have a huge impact on your travel costs, as recent research from property website Zoopla has shown. The study combined the average cost of a season ticket with the average yearly mortgage repayment, to reveal the most affordable commuter towns to live in this year.

For commuters to London, Grays in Essex is officially the cheapest commuter town, with mortgage repayment and sales ticket costs totalling £15,008 per year. The top three for London commuters is then completed by Leagrave in Bedfordshire (£15,399) and Crayford in Kent (£15,662).

Outside London, the best value commuting town for Bristol is Newport in Wales. Wolverhampton offers the best value for Birmingham and commuters to Manchester should look to Hindley. If you want to save money on your commute to Edinburgh, you could consider buying in Dunfermline to keep your costs down.

Edinburgh is best city to live in as a young adult

Comparison site, Compare the Market, recently rated the Scottish capital as the best place to live for 18 to 35-year-olds. The site analysed aspects such as rental costs, living expenses, mental wellbeing and nightlife to come up with the final list.

Manchester, Bristol, Liverpool, Newcastle and Glasgow also made it onto the top 10 list. Newcastle was found to boast the cheapest average monthly rent (£567), while, unsurprisingly, London is the UK’s best paid city, with an average salary of £47,089.

Gap narrowing between buyers’ and sellers’ expectations

In Q4 2019, Savills conducted analysis on its prime regional markets to come up with a list of top factors likely to influence the residential property market in 2020.

Almost three quarters (72%) of Savills regional sales teams identified Brexit uncertainty as a major challenge for 2020, while 54% said that a lack of housing stock would become problematic as buyer demand increased.

Importantly though, many teams observed that buyers and sellers’ pricing expectations were becoming more closely aligned, with sellers willing to accept more realistic offers and buyers happier to pay asking prices.

House Prices Headline Statistics
House Prices Changes by Region
Average Monthly Property Price by House Type
Mortgage Activity

It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK. We cannot assume legal liability for any errors or omissions it might contain. Levels and bases of, and reliefs from, taxation are those currently applying or proposed and are subject to change; their value depends on the individual circumstances of the investor. No part of this document may be reproduced in any manner without prior permission.