Beat the First-Time Buyers Market

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by: bythesea
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Date: Fri, 4 Jun 2010 Time: 3:19 AM
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The number of first-time buyers has plummeted to a 19-year low, according to the latest research. Around 347,000 new buyers applied for mortgages between February 2009 and February 2010, which is less than half that of just five years ago, a GfK Financial Reseach Survey has found.

With heavy restrictions on mortgage lending still firmly in place, and property prices starting to recover, there seems to be no end in sight for young buyers struggling to get onto the housing ladder. But there are options out there that could help you become a homeowner sooner than you think.

Government schemes

Help from the government isn't just available for key workers in expensive cities. The ‘Homebuy' scheme could help you buy a property if you are a first-time buyer in a household that earns £60,000 or less.

If you qualify, there are two options: You could go for 'HomeBuy Direct', which helps you to buy a property on certain developer sites through a loan of up to 30 per cent of the property's value; or you could chose 'New Build HomeBuy' which helps people to buy a share of a newly built property and pay rent on the remainder.

If you can't afford either of these, there's ‘Rent to HomeBuy', which means renting a newly built property for a fixed length of time while you save enough deposit to become eligable for the ‘Homebuy' scheme.

Buying with friends and family

If someone you know wants to partner up for a mortgage, it could be the answer to your home ownership dreams. But before doing anything, think about what a change in circumstance later on might mean. How would you sort out things like buying the other out, or selling up? It is therefore vital to draw up a legal agreement for the arrangement before finalising a home purchase.

Don't panic if you don't know the first thing about the law. The Community Legal Advice Directory - a government information service - lists all the appropriately qualified solicitors and advice agencies in England and Wales.

Buying at auction

There's a reason why property auctions are always full of builders - they're hoping to snap up a cheap deal and do the place up. With a little research there's no reason why you can't do the same.

Once you've found an auction (try your local paper, estate agents, or search online), you'll need to request a catalogue of the properties going under the hammer.
If you find a property you like, the first step is to contact the auctioneers and arrange a viewing. If you can, take a builder or an architect with you because these properties often need attention.

If you're still happy, you'll need to consider the price. An auction guide price is usually quite low to encourage bidders, so try to find out what similar homes nearby have sold for. That way, you can go into the auction knowing what a fair price is for the property.

Before the auction, make sure your mortgage is in place and you've carefully read the legal pack the auctioneers gave you when you expressed interest in the property. Lastly, have a maximum figure in mind and stick to it, because once that hammer comes down, the property is SOLD!

Win a house!

The idea of forking out just £25 or £50 to get your hands on a mansion is very tempting, and these deals have been in the news a lot recently. The basic idea is that the owner of a home sells raffle tickets to at least cover the cost of the house, and then draw a winning ticket. It sounds like a bargain bet, but check that the vendor has a gaming license first, just to make sure that you're adequately protected should something go wrong.

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If reading this has made you realise that you could afford to get a foot on the property ladder, why not compare mortgages online to find the best mortgage deals available to you.