Moving to London is a dream for many people of all ages. The hustle and bustle of the capital combined with a plethora of attractions, world-class eateries and exciting career opportunities draw people from across the globe.
However, purchasing a home in London can feel impossible without significant planning and financial support. This is especially true if it’s to be your first home. Here are some tips to help you get on the London property ladder without getting into significant debt.
Speak to a mortgage advisor
When looking at the capital for a place to live, speak to an independent mortgage advisor in London. They will know the area well and be able to give you tailored advice. Find out what you are likely to be able to borrow as well as how healthy your credit score currently is. Mortgage advisors are great for finding the most competitive rates on the market, setting you off on the right foot.
Increase your savings
Simply put, the larger your deposit, the better your position will be when it comes to mortgages and being an attractive buyer. Generally, you will need 10-15% of the property price as a deposit to stand a chance in London, but some lenders will permit just 5%.
Make your savings accounts work for you. Many banks offer accounts with good interest rates. There are usually conditions that need to be met, such as a certain amount to be deposited per month or no withdrawals in the first year. The interest accrued, however, can add up and give your savings pot a bit of a boost.
Reduce your spending
If you do need to save more then look for areas where you can reduce your spending. Rent is often the largest outgoing monthly expense. For some, moving home is an option that will allow them to save a significant amount of money. However, this isn’t always possible, so consider moving to a cheaper property or house share temporarily whilst you save up.
Subscription services are often charges that come out of your bank account relatively unnoticed. Although they are small amounts, having multiple platforms can add up. Think about whether you can live without them for a while or see if anyone is willing to share their account with you!
Consider shared ownership
Once you feel you have taken all the reasonable steps to save up and are still struggling, think about alternative ownership options. Shared ownership is where you buy part of a property and pay rent on the part you don’t own. You can usually buy between 25% and 75%.
This is a great option for getting your foot on the London property ladder and you always have the chance to increase your share in the future.
