Five steps to get onto the property ladder

As it seems like house prices have finally reached their peak, it could be the perfect opportunity for first time buyers to buy a dream home, and Bellway East Midlands is offering its top five tips on how to get onto the property ladder. With the recent fall in house prices being offset by increasingly stringent lending standards, first time buyers with little or no savings may think they have no choice but to delay their property plans.

Bellway East Midlands is offering its expert advice to first time buyers on why now is the perfect opportunity to finally buy their first dream home.

Ben Smith, Bellway sales director, has provided five steps on how young homebuyers can get a foot onto the property ladder in the current housing climate, as well as taking advantage of its wide range of starter offers.

1. Save up that crucial deposit

Following the recent death of the 100 per cent mortgage, homebuyers are compelled to save up the conventional deposit. With the average price of an East Midlands home being £173,000, a five per cent deposit for a 95 per cent mortgage would mean saving up a minimum of £8650.

Ben suggests drawing up a budget for weekly expenditure, which will highlight areas where homebuyers are overspending, whilst opening a savings account and depositing a set amount each month will quickly prove to be worthwhile, especially if both you and your partner contribute to the pot.

2. Move back home

Young homebuyers may have just escaped the family nest to enjoy their freedom and independence, however although it may not be ideal, temporarily moving back into the family home can be a perfect solution for those wanting to save serious money for a deposit. Setting a few ground rules with parents, whilst paying them a modest amount of ‘board’, should keep intrusions of privacy at bay and allow for an independent lifestyle.

3. Visit the bank – of mum and dad

More and more people are turning to their parents for financial help in buying their first home. This provides homebuyers with a larger initial deposit, resulting in lower interest rates and a wider range of deals available. What’s more, the money homebuyers lend from Mum or Dad will almost certainly carry with it much lower interest rates than a bank could ever offer.

4. Rent a room

Instead of tackling the whole mortgage alone, why not plan to rent one of the spare rooms of your new home out to a friend or lodger? This is ideal for single buyers or couples who purchase a two bedroom property who would like an extra income to help out with the mortgage repayments.

5. Buddy Up

A number of young homebuyers are teaming up with siblings, friends or like-minded young professionals who are tired of renting and want to buy their own property. Each taking shared ownership of the property means homebuyers can own a property they could only dream of buying alone.

Bellway also offers a number of buying plans and special offers that give homebuyers a kick start in finding their dream home.

‘Sharebuy’ is a part buy, part rent scheme available to first time buyers who cannot afford to buy a home of their own on the open market. Successful applicants will normally buy between 50 and 75 per cent of the value of their new home from the Bellway Housing Trust, depending on what they can afford, and pay a subsidised rent on the remainder.

As time goes on, the purchaser can choose to increase their share of ownership by a minimum of 10% each time, ultimately working towards full ownership.

‘Opening Doors’ offers homebuyers the chance to buy a new home for 80% of the current market value. This means that a property priced at £139,950, will be available for the cost of interest payable on a home under £112,000. Payment of interests on the remaining 20% is deferred for three years and is treated as an equity loan charged at the low interest rate of 3%.

Ben Smith, said: “We are currently offering some great deals for first time buyers, and with the house prices starting to fall, now is the right time to buy. Some of our homebuyers can benefit from having their deposit paid by Bellway too, which not only takes out the stress of having to save up, but also means homebuyers will be able to secure a home they really want.

“This, in addition to plans such as Opening Doors and Sharebuy, means homebuyers will be able to buy their ideal home at an affordable price, instead of buying a cheaper home that’s almost perfect.”

Bellway East Midlands has developments spanning the region from Nottingham to Northampton, offering a range of innovative house-types from one bedroom city-style apartments, to detached family homes in rural locations.

For further information on buying plans, latest home designs and developments from Bellway East Midlands, visit the company online at Bellway.co.uk.