First Time Buyer tips for getting on the London property ladder
31 May 2017
By Ersin Mehmet
With the average house price in London reported as being £471,742 with a monthly change of -1.5% (March 2017 - source: www.gov.uk) and with the mortgage rates still being very competitive ranging from 60% LTV (Loan to value) 2 year fixed @ 1.19% up to 95% LTV 2 year fixed @ 3.75%, now is a very good time to buy your first home in London.
There are plenty of properties to choose from and many motivated vendors who are looking to find the right buyer like you!
It's only human nature to desire the newest and nicest property that you see, but you will still have to put you best foot forward to secure that dream home and in this blog I will be showing how you can stand out from the crowd, helping you receive that call from your agent with the latest property; before it goes "under offer" on your preferred property portal.
With the pool of buyers being the largest at the lower price points, competition is still very high in the London housing market, to stand side by side with cash buyers and professional landlords wishing to add to their portfolios follow these simple steps:
1.) Attain your mortgage in principle / agreement in principle (MIP/AIP)
Speaking to a good mortgage broker or high street lender is the first step to the property ladder, in this meeting you will find out exactly how much you can borrow, what your monthly payments will be and all the costs involved in your move, including how much Stamp Duty you will be liable for and you will be presented with an MIP / AIP certificate, which means subject to credit checks and mortgage survey you will have in writing what you can afford, putting you alongside a cash buyer.
We all know "cash is king" but I challenge you to speak to any estate agent and say to them "here is my agreement in principle", watch them sit up and say to you "shall we go and view some flats now!?".
Providing evidence of an AIP/MIP to your estate agent will prove to them that you are serious and the offer you put forward to the seller (who has just had 10 buyers view their flat on the first weekend of viewings) will be seen in best light putting you at the top of the pile!
2.) Register with your local estate agent face to face in their office
London estate agents will register many new buyers on a daily basis, most agents will have over 50 buyers to speak to at any one time! So how you can be sure that you will be called first when they have that new flat for sale near your favourite hot spot and most convenient tube station? Simple, go see them, shake hands, have a chat about your "needs and wants", outline the best time they can call to update you and if you have any favourite locations or blocks that you would love to move to now is the time to tell them, you may even be offered a free coffee for your troubles!
Agents are nice people, we remember nice people and by meeting your local agent they will have you in the back of their minds when they value that flat they know will sell within a few days of coming to the market. That first time buyer (with AIP in hand) who took time out of their sunny Saturday afternoon to register to buy with them will be the one they phone first to book in for the first viewing, let that phone call be to you!
3.) Instruct a good solicitor
Once you find your dream home, with your mortgage in place and your savings set aside for your deposit the final step is sourcing a solicitor. Many mortgage lenders will only accept a solicitor which is on their approved panel, so check with the solicitor if they can work with your mortgage lender. Choose a firm that work efficiently and won't delay your purchase don't choose the cheapest firm that you find on Google, in this industry you really do get what you paid for.
This property purchase will be the most likely be the most expensive purchase you have ever made, so why risk playing "telephone tennis" with a solicitor as you decided to try and save a few hundred pounds?
A good solicitor will work well with the estate agent and sellers solicitors, communication is key and all good solicitors know this. Once you have had your offer agreed (as long there is not a long chain involved) you should be looking to exchange of contracts and pick a completion (move in) date in around 3 months.
For any advice on buying your first home in London please feel free to contact us (020 7644 2331) we are all here to help you. Happy house hunting!