Forecasting how the United Kingdom home market will behave within the next 12 months is never easy. Over the last few years we have seen a number of false dawns and claims of recovery that never materialised. However a number of signs are beginning to appear that the worst might be over for United Kingdom homeowners. Many regions have seen small cost increases in 2011 with £5,000 being added to the value of the average house. So if you are a first time buyer is it a good time to enter the market? Whilst there have been some gains prices are still lower than they were at the same time last year. The forecast for the rest of 2011 and early 2012 varies on who you listen to. However most experts are of the opinion that the market will stay flat or see small price increases. So if you are thinking of investing in a home I would say do it now. The cost of property is not likely to fall and while any increases may be small they will only add to the expense of buying a home. If you are thinking about buying your first home or flat here are some tips:
Mortgage and Other Expenses
The need for large deposits by most lenders is among the main reasons for the lack of activity in the market. With relatively few new buyers entering the market the volume of houses sold reached a record low in 2010. However whilst 10% mortgage deals are still the norm there are indications that lenders are easing their restrictions on lending slightly. There are now a lot more 95% mortgage deals available with competitive interest rates. When you are saving for your home there are lots of other costs that you need to consider as well as the deposit. You’ll have to pay for stamp duty, solicitor’s fees, surveyor’s fees and also land registry fees. You’ll also need to furnish your new home and pay for all of the bills. This is often quite an increase in your monthly budget if you’ve been living with your parents or in shared accommodation. New or Used Home? Should you invest in a used or new property? With the current lack of activity in the housing market a lot of developers find themselves with a large stock of unsold new properties on their hands. You can find some great deals on new homes with many developers lowering asking prices considerably. Many developers are offering incentives including free white goods or assistance with finding a deposit. In general new homes are also cheaper to run and will come with a 10 year manufacturer’s warranty.
Shared Ownership
Shared ownership schemes have grown to be a lot more common recently. They enable people to buy a share in a house which they normally would not be able to afford . A mortgage is paid on the portion of the property you own and rent to a housing organization that is the owner of the other share. You can increase the share of the home you own over time so that ultimately you can own 100% of it. Another option is to consider purchasing a property with a few of your friends. This might appear like an attractive choice but can have its downside. Always use a lawyer to draw up agreements to make sure that everyone knows their obligations and responsibilities.
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