Important Points To Consider For First Time Buyers In 2022

Purchasing a home is reputed to be one of life’s most stressful events and, if you’re a first-time buyer with no prior experience of the process, it’s even more important to work with a residential conveyancing specialist who can help you to negotiate the hurdles.
At Astle Paterson we support first-time buyers as they step onto the property ladder, and we keep abreast of all the changes in the property market to help you to make the right decisions at the right times.

How 2022 Is Shaping Up For Homebuyers

Despite the challenges faced by many families recovering from the global pandemic, the UK housing market is thriving, and mortgages are widely available from banks at competitive rates. If you’re contemplating purchasing your first property this year, what points do you need to consider?

1. Do You Have a Large Enough Deposit?

In recent years, first-time buyers were required to have a significant deposit of 15 or even 20 per cent, which made saving incredibly difficult for young people just starting out in their careers. Rising house prices have also contributed to the problem, but low-cost 95 per cent mortgages are becoming more widely available, meaning you’ll need to save less to be considered for a property loan.

2. How Much Can You Borrow?

When arranging a mortgage, it’s important not to overstep your budget and borrow more than you can afford to repay. Mortgage lenders will assess your financial situation carefully and apply affordability tests to determine the maximum loan they are prepared to authorise, which may be between four to five-and-a-half times your salary. The bank will consider existing credit commitments, such as personal loans and credit cards, and adjust the amount of the loan accordingly.

3. What Are House Prices Like Locally?

The Stamp Duty holiday introduced by the Government during the Covid crisis led to property prices soaring, with an average increase of 10.9 per cent in the 12 months leading up to February 2022. According to MoneyWeek, house price increases are likely to remain high for some time to come, although regional variations exist. When looking for a house and weighing up how much you can afford to borrow, it’s worth exploring local property prices to get a clear idea of your required budget.

4. Can You Afford The Additional Costs of Moving Home?

There are several additional costs for which you will need to budget, including:

• Stamp Duty Land Tax (if purchasing a property over £125,000, the current rate is 2 per cent of the purchase price, rising to 5 per cent for properties sold for more than £250,001).
• Conveyancing costs (on your purchase only if you are buying a property for the first time).
• Removal costs.
• Mortgage advisor commission if you use a broker.

These fees are usually paid on completion, so you will need to ensure you have the funds available to settle all invoices.

Contact Astle Paterson For Professional Conveyancing

As expert property conveyancing solicitors, we can help take the stress out of legal process of house buying, so you can focus on looking forward to moving into your new home.

We’ll keep you informed at every stage of the process and will always answer your questions honestly, so for a free, no-obligation quotation, please get in touch today.

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