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London property market blog


/ by In house team

First time buyers storm the market

First time buyers are taking the property market by storm. In 2012, more than 40% of all purchasers who bought through KFH were buying for the first time but with recent help from the Government, that figure looks set to rise this year. This echoes recent reports from Rightmove who estimates that 42% of all registered purchasers in London are first time buyers.

South West and South East London are currently the most sought after regions among the first time buyer market with many opting for areas including Tooting, Earlsfield, Crystal Palace and Forest Hill. Chief considerations for first time buyers are pricing, local atmosphere and convenient transport links into central London.

With price being a major consideration, it's interesting to note that the average price paid by KFH first time buyers in 2012 in the top three areas, which included Tooting, Earlsfield and Streatham, was £358,227. The first time buyer average across London was a little higher at £374,037. In contrast, two years ago the more centralised areas of Kennington and Peckham  were at the top of the poll, suggesting that since 2010 first time buyers have gradually been pushed out further afield in search of areas which offer a bit more for their money.

Figures from Kinleigh Financial Services reveal that the average deposit that our first time buyers are paying is now 25%, even though there is now a range of mortgages available that requires deposits as low as 10%. This points to interest rates being a key consideration for many and also nods to the fact that many are still able to acquire funds from 'the bank of mum and dad'.

The spike in first time buyer sales can partially be attributed to the increased variety of mortgages and lower loan to value rates on offer. The new Government ‘Help to Buy’ mortgage scheme, announced in April this year has encouraged a large number of tenants to take the leap and secure a home of their own.

Many underestimate the amount of leg work involved in buying their first home however, and often stumble at the first hurdle as a result of either not having done their homework or not being aware of everything required. With such a competitive sales market currently, it's crucial to have the right advice from experienced and knowledgeable advisors. My top three tips to get ahead include:

1. Make an early appointment to see an independent mortgage and protection advisor – before you even start your search. With access to the most comprehensive mortgage options available to the market and at the best rates, these professionals are there to talk you through the entire process from start to finish. They will ensure you are aware of all the costs involved for the entire property purchase, will proactively tell you how to put yourself in the strongest position, and will help guide you throughout the transaction. Just having an initial conversation with them will be helpful as you only pay a fee when you agree your mortgage. Anything before then is just free advice.

2. Have your mortgage agreed in principle before commencing your property search. Doing this will mean that you know for certain the price level at which you can buy and will also mean that you can move swiftly to offer on a property and get the process of purchasing moving quickly.

3. Ensure all of your financial documents are in place. These will always include pay slips, bank statements and contracts of employment. Make sure that you have everything you need as being short of just one document will slow the process down and jeopardise your application.

About our expert View all posts by this expert

In house team London Property Market

As the marketing and communications team at Kinleigh Folkard & Hayward's head office, our aim is to keep you updated and informed where the London property market is concerned. In addition, we'll bring you tips on navigating current issues and trends in the market when buying, selling, letting and renting to ensure that whatever field you're interested in, you'll be completely informed.

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