We take a look at the various routes buyers are taking to purchase a home in London. From government schemes and properties that need refurbishing to finding the best value areas, here’s a comprehensive guide to buying a London property.
London can seem like an intimidating prospect for buyers trying to get onto the property ladder. However, there are a number of options for buyers that can make the process cheaper and easier. Below are ten things to consider if you’re serious about buying a slice of the action.
Research the best value areas
Good value means different things to different people, but a good place to start is the House Price Index. This gives a guide to average prices in each of the London boroughs. Check out the ten cheapest places to buy a property in London in 2019.
Target commuter options for your workplace
Balancing the cost of your property with commuting costs can be a challenge. Move further out and your tube or rail fares will increase, but you will get more for your money in terms of your property.
Choose your area well, however, and you’ll find a good balance between property prices and commuting times. This list gives you an idea of what’s possible – a collection of one- and two-bed flats under £230,000 that are still only a 45-minute train ride in central London.
Look at potential regeneration areas
Researching London’s biggest regeneration areas is a great way to find a property that is likely to appreciate in the coming years. Parts of London where major developments or transport extensions are being built often see increased investment, which usually increases the value of property in the area.
Explore renovation properties
Renovation properties are homes that are in need of some work to bring out their full potential. These can range from semi-derelict buildings that need major restoration or a total rebuild to properties simply in need of some modernisation. These can offer excellent value, especially where the owners can live in the property while they work on it.
Look into Help to Buy
The Government’s Help to Buy Equity Loan scheme offers buyers in London a loan of up to 40% of the value of an eligible new-build property. With only a 5% deposit, the buyer only needs a mortgage for the remaining 55% of the property. This is solely available to buyers who do not own any other properties, and is a great option for first-time buyers.
Look at Shared Ownership options
Shared Ownership is another part of the Government’s Help to Buy scheme. This allows buyers whose annual income is less that £90,000 to buy a share of 25-75% of an eligible property and pay rent on the rest. As with all these options, but especially with Shared Ownership, it is essential buyers weigh up the total costs of their mortgage, rent payments, service charges, property upkeep and all the usual utility bills.
Alternative funding options
When it comes to financing your new property, there are a number of alternative options that are becoming increasingly popular among buyers. Family and friends helping to pay for a new property is something many mortgage providers are becoming very familiar with. This could take the form of them making a contribution to your deposit, or a family member acting as a guarantor for your mortgage.
Alternatively, this could also mean co-buying with someone and sharing the property and its associated costs. Obviously, this requires careful consideration! Agreements will need to be negotiated about, such as how costs will be split, how long people plan to live in the property and any extra members joining the household.
Whatever route you take to home ownership in London, once you make it to the point of purchase, here are six tips that every first time buyer needs to know… happy hunting!