Excitement should be brewing amongst first time buyers because your time to shine in the property market is coming, and you need to be getting ready for it!
As of April 5th (to be confirmed in the Budget statement), second home owners will be hit by an extra 3% stamp duty, on top of the current stamp duty costs. This is a huge cost which has caused chaos amongst investors. The repercussions are yet to be seen, but the amount of complaining and grumbling from the buy-to-let sector indicates that a lot of Landlords will be put off entering the property market until the dust settles.
This is absolutely fantastic news for first time buyers. At the moment the property market is a daunting place, we have been there as well; open houses with lots and lots of people looking around, investors squawking loudly to put those with less cash off and then the resulting bidding process where property newbies just don’t stand a chance as property prices are driven upwards. Well, this massive jump in the cost of buying should deter investors, meaning a clear path to those once hard to get first time pads.
As a first time buyer you must look at this as a very favourable situation. Now is the time to start flexing your muscles in the market. Especially because you never know how much longer interest rates will stay low for – so you should also be able to get a great deal on finance!
Our advice to you is to start now, count your pennies and work out how big your savings pot is. Then enlist the support of a mortgage broker – get your finance in place. Brokers are great at helping with your savings, they will be able to advise roughly how much you have as a deposit and how much you need to put aside for the cost of legals and stamp duty. This will also give you a budget – how much you can spend.
Then search the market, look through property search engines and work out what you can get for your money in your area and set your expectations. Use this confidence to email all the agents in your area with your requirements, budgets, property spec, when you want to move and show them you have finance – this will give you so much clout. It will impress agents and they know that you are serious.
The next step is to go to viewings. We always advise that you should get individual viewings, but if you must go to open houses then the same rule applies. Walk in as a buyer on a mission, you want to see this property and you want to understand it. Don’t be afraid to ask questions, take measurements and walk round a million times. If it’s not for you, you will know instantly, but if there is something there then explore it. Use your initiative and your gut. Listen for noise, check common areas, look at outdoor space, know the property. We know the first time you look you can be nervous and not take it all in – but you are there because you are on the playing field so take it in.
Once you are done check-in with the agent, tell them if it’s something you are considering or whether you will discard it. Being honest here is really useful, saying you are considering it will mean that the agent will update you when offers come in or if there are any changes with the property.
If you get to the crunch and you want to put in an offer – again use your instinct. Remember you are now more a prime candidate to buy the property than ever, so put your offer in with full confidence and explain the reason for the price you put down. You can offer what you like, obviously going stupidly low will usually get you a no, but if you don’t ask you don’t get so why not go for it, you can always raise your offer afterwards (unless it’s best bids…).
At some point everyone is new to buying property, but don’t be nervous, your perfect property is out there for you and now you have more opportunity than before. All of a sudden you are the prime buyer, because you will not be chipping away at price to save on additional taxes, you will be bidding on a product you love. It’s time for first time buyers to own the market as the pecking order has just changed, you are now at the top of it.
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