The London Help to Buy Scheme – taking the first step on the property ladder in London

Buying your first home in London is often believed to be beyond the reach of many young professionals – and it certainly isn’t easy. But a sluggish property market, softening house prices, low mortgage interest rates, discounts from developers and the London Help to Buy scheme – mean that this could be the best opportunity many professionals will have to make their first move onto the property ladder.

We are working with increasing numbers of first-time buyers keen to take advantage of the current situation, assisting them throughout the homebuying process, from helping them find the right type of property within their budget to navigating the Help to Buy scheme application and the mortgage application process.

What is The Help to Buy Scheme?

The Government’s Help to Buy Scheme is aimed at first-time buyers and existing homeowners who wish to buy a new-build property, providing part of the equity needed in the form of a loan which means the buyer needs to borrow less from a mortgage company and needs a smaller deposit.

There are several different options within the Help to Buy scheme, depending on your needs and circumstances.

Help to Buy: Equity loan – the Government will lend you up to 20% of the cost of a new- build home – or up to 40% for homes in Greater London.

London Help to Buy – because London properties are more expensive than in the rest of the country there is an additional scheme for those wishing to buy a property in London. The Government will lend up to 40% of the purchase price of homes in Greater London. You must put down a 5% deposit on a new-build property valued at up to £600,000.
You must not own any other property when you buy the new property. And you must not sub-let the property or enter a part-exchange deal with your old home.
For more information, go to www.helptobuylondon.co.uk

Help to Buy: ISA – first time buyers can open a Help to Buy ISA with a range of banks and building societies and, if they save up to £200 per month, can receive a Government bonus of between £400 (if they have saved £1600) and £3000 (if they have saved £12,000). Buyers must instruct their solicitor or conveyancer to apply for the bonus when they are about to buy their first home.
Go to www.helptobuy.gov.uk/help-to-buy-isa for more information.

Shared ownership – if you cannot afford to pay 100% of the cost of a home, you can buy a share (25% – 75% of the cost of the property) and pay rent on the remaining share. You can buy more shares when you can afford to. You can do this if your household earns less than £90,000 per annum in London (or £80,000 per annum outside London). It must be a newly-built home or an existing property through a resale programme from a Housing Association.

More information can be found at www.helptobuy.gov.uk/shared-ownership

What should first-time buyers be aware of? And how can Benham & Reeves help?

Getting the best deals

Trawling through websites to uncover the most cost-effective options for buying your home can be daunting. For example, how do you know if you are being offered a competitive interest rate? What fees should you be paying?

You also need to accurately work out your budget – based on your salary, your deposit and any additional loan from the Help to Buy scheme.

If you’re spending up to £600,000 on a property, you want to make the right decisions – so expert advice is essential. We can work with you to make sure your paperwork is in order and you are getting the best deals.

Finding the right property

New developments in London

Next, the property itself. Where would you like to live – in which area and which Zone? How far from public transport do you need to be? What type of amenities would you like nearby?

Which new build developments are located in this area? Ideally, what type of facilities should they have – private parking, a gym, a concierge? What is the annual service charge? What is important to you?

We can provide expert knowledge when it comes to the property search, advising on suitable areas and developments within your budget – and your ideal commuting distance. We have access to new-build properties in Zones 3 and 4 from as little as £300,000.

We work extensively with many Tier 1 developers so we can also negotiate on your behalf and help you take advantage of the many discounts currently on offer. And we have a ‘little black book’ of trusted mortgage companies and solicitors who you may wish to work with to take care of the financial and legal side of matters.

Furnishing your new home

Finally, if you want your new home to look its best, our professional furnishing company can supply stylish but economically priced furnishing packs to suit any budget and size of property. It’s a simple and surprisingly cost-effective way to furnish a new property from scratch.

Taking the first step …

If you are considering buying your first home and would like someone you can trust to help you throughout every step of the process, then please get in touch with our sales team on 020 3280 6400 or email us. They can guide you throughout all the aspects of this important stage of your life and take the stress and worry out of this major financial investment.

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About the Author

For 35 years Anita has been the driving force behind Benham and Reeves’ success as it has grown from a single branch in Hampstead, to one of central London’s oldest, independently owned sales, letting and property management companies. Anita's vision has driven the expansion of the business to offer a complete range of property investment related services from under one roof, from purchase to handover, furnishings and/or refurbishment to lettings and property management. Read more about Anita Mehra here - Read full profile

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