Tips to Help Young People Get on the Property Ladder

People aspire to own their own property for a variety of reasons, from financial investment in their future to the mere satisfaction that comes with the title of homeowner.

It seems, however, that we are constantly being told these days how difficult it is for young people to get on the property ladder. Prices are up, wages are down, and things can seem pretty bleak, but amidst the doom and gloom there is in fact some good news; the number of first time buyers reached its highest level since 2007 at the start of this year, meaning new initiatives to help young people are working and there are indeed several ways you can make owning your own home that much more achievable. Here are just some of them:

1. Start saving as soon as possible: It’s never too early to start preparing for your future, and one of the best ways you can do this is to start accruing a healthy deposit, since it’s this hefty initial down payment that is so often the first and biggest stumbling block between young people and the keys to their own home.

1. Consider location carefully: The reality is that where you choose to live can save (or lose) you tens of thousands of pounds. London, for example, has long been known for its soaring house prices. Central areas of the city are so expensive in fact that it has caused a ripple effect of rising prices spreading outwards as prospective buyers are pushed out of the market. Spotting trends and changes like this in your desired area can make it much easier to identify the cheapest time/place to buy.

1. Shared ownership: This is a scheme which sees you pay a smaller mortgage on half of a house, and rent the other half from the government. As and when your income/savings increase, you can buy a higher share of the property, until such time that it belongs entirely to you.

1. Joint mortgages: If you’re in a relationship and on the lookout for a home in which to live together, it may be worth exploring a joint mortgage, under which you could pool your resources and split costs 50/50. This, as with any financial agreement, should be entered with caution however, as things could get ugly if the relationship were to end and one of you wanted out of the property.

1. Help to Buy: There are two types of Help to Buy scheme available from the government; an Equity Loan, where they lend you a percentage of the cost so that you can pay a significantly smaller deposit, and an ISA from the bank, where they will boost your savings by 25%, up to an additional £3000, helping you on the way to that all-important first payment.

1. Family support: A lot of people don’t like feeling like they’re relying on the bank of Mum and Dad, but in many cases the financial support of family can be invaluable. Be it living at home for a while to facilitate saving up, borrowing money interest free to help with the deposit, or asking them to be a guarantor on your mortgage so that lenders are more likely to take you on; there are many practical ways they can help.

from Finance Girl http://www.financegirl.co.uk/tips-to-help-young-people-get-on-the-property-ladder/