Buying a new home in the current housing market was always going to be a struggle. With a third of millennials still predicted to be renting in their 40s and house prices skyrocketing in the previous 10 years, it’s to no one’s surprise the government have now stepped in with schemes that are set to change the way we buy homes especially in such a bleak current market. But while many of these schemes seem like a positive move in principle, what are the benefits, drawbacks and details and how do you know what would work best for you?
Help to Buy
A popular scheme and a size-fits-all concept towards buying your first home, help to buy allows you to pay just a 5% deposit while receiving a 20% no interest loan for the first 5 years of your mortgage. Making it considerably easier for first time buyers to make a move a lot sooner than they may have foreseen, help to buy is ideal for anyone looking to get on the property ladder in the next 5-10 years. A lot of housing can be bought through this scheme from family homes to apartments and with the scheme reaching the length and breadth of the country, help to buy can really take the pressure off when it comes to buying your first home.
A new scheme that’s a little more out there is shared ownership. No it doesn’t mean you will be sharing your bathroom with anyone you simply buy shares in a property rather than getting a mortgage on the whole house straight away.You can purchase between 25%-75% of a property while renting the rest and only pay a deposit on the share you own, making your initial payments a lot less of a stress. And what’s even better is you can get shared ownership in London, shared ownership in Manchester and even shared ownership in Brighton.
London Living Rent
This one is ideal if you’re a first time buyer in London and want to gather your savings before putting down a deposit on a house. With cheaper rental costs and priority when it comes to shared ownership in the city, it’s a great way to kick start your journey to owning your home. With a minimum lease of 5 years and ⅓ of market rental costs it’s ideal for Londoners looking to buy in their home city.
Help to Buy ISA
If you’re looking to get on the property ladder in perhaps the next 5-10 years, a Help to Buy ISA is a good way to go about it. With the government giving you 25% extra of whatever you save you could be given up to £3000 towards your deposit. You can open the account with as much as £1000 today and chip in £200 a month to get your savings in motion.
With plenty of options out there you can get onto the property ladder a lot sooner than you might think. So don’t wait around, be smart with your money and take advantage of what’s out there to get you the best deal.