Mortgage Advice for First Time Buyers, First Time Buyer Mortgages and First Mortgage Advice

The price of property - biggest costs for first time buyers

16-Oct-2014

When it comes to the price of housing, there are all sorts of considerations that many first time buyers do not think about.

The price of decorating is one of them, as well as the cost of stamp duty and making repairs to the new home.

Generally, it is cheaper to buy a home that is in need of improvements, rather than an expensive home, which will add another £100,000 to your mortgage.

However, in order to get the best possible deal, first time buyers need to think about exactly what - if any - improvements need to be made to their home, and compare this cost to the current offerings on the market.

Of course, there are many initiatives out there designed to help new buyers get onto the property ladder - such as Help to Buy - which will be discussed later on. 

But being able to weigh up all the costs in the initial stages will help investors to make a more informed decision, which they won't come to regret later on.

Biggest expenditure

A new study by Lloyds TSB has helped to unveil the biggest sources of expenditure for first time buyers.

Its research found that over two-thirds (71 per cent) of first time buyers and homemovers are spending up to £2,500 on their first project in their new home.

The biggest project that people tend to spend their money on is - unsurprisingly - the paintwork or wallpaper, cited by 33 per cent of people.

A further 15 per cent spent money on carpets, while six per cent splashed out on kitchen renovations.

Some five per cent of consumers spent money on a new central heating system, while the same number invested in new fitted windows.

Nearly half of those surveyed (49 per cent) claimed that their new project was essential, while 27 per cent also felt that it would make the house feel more homely in the short term.

The research found that when moving into their new abode, 37 per cent stated that they would prioritise any changes to the lounge first, followed by 18 per cent doing work on a bedroom.

Furthermore, 16 per cent said they would splash out more on the kitchen, while eight per cent prioritised the toilet or bathroom.

Help to Buy

But how are first time buyers able to afford all of this - particularly with recent research by Oxford Economics and Rightmove stating that prices are set to rise by 30 per cent?

The government's Help to Buy scheme enables people to get onto the property ladder with a relatively small deposit.

According to new findings by Orbit Group, the initiative is attractive an increasing number of people over the age of 40, with nearly a quarter (24 per cent) of applicants in this demographic.
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There's alot going on! What do you think?

Interest rates are low but could rise? Is this a good time to buy?

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Varialbe rate mortgages go up if bank interest rates do. Which is your preference?

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Interest only mortgages are cheaper but in the end you don't end up owning the property. Which is better?

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House prices are waivering. Do you think this is a good time to buy?

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Shared equity mortgages allow you to buy a new home with 5% deposit and an equity loan through FirstBuy. What do you think?

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Rent to buy allows you to peg a property price, save towards a deposit and pay reduced rent. What do you think?

Works best in a rising market
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