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30/08/2012 17:42:35

Tips for the first-time buyer

In June, we highlighted some of the difficulties faced by those hoping to climb onto the property ladder. High deposits, the end of the stamp duty holiday and difficulty saving all present road blocks to home ownership.

However, despite these inherent issues, there are steps prospective first-time buyers (FTBs) can take to allow them to get a foot up.

Consider your options

Before any progress can be made, all FTBs must carefully consider the 'who', 'what' and 'where' of house buying.

Firstly, who do you want to buy a home with? Chipping in with a group of friends can help spread the burden, but it can also create issues further down the line if those involved want to go their separate ways. Therefore it is important to have some kind of agreement drafted up. 

Then there is the 'what' and 'where'. A semi-detached home in the suburbs? A flat in the city? A house boat? And what about the age of the property? New houses require less upkeep and may come as part of special deals from the developers.

Government schemes such as HomeBuy can also offer options to FTBs, with loans provided towards the home's purchase price and no fees for five years.

Paperwork

Once you've made the decision to take the plunge, according to mortgage expert Andrew Montlake, you can give yourself a much better chance of success in securing that all important mortgage with a bit of preparation beforehand.

"All lenders want to make sure they are lending money to someone who is highly likely to pay it back," he explained to the BBC.

This means digging out bank statements, payslips and old addresses to build up a picture that you are a reliable worker and tenant.

"Providing this information on day one can speed up the process no end," Mr Montlake added.

Staying within your means

Mr Montlake also advised FTBs to be wary of seeing home ownership as an investment.

"The view that buying a property is as much an investment as a home looks outdated," he explained.

"House prices are unlikely to rise much in the near future, which is actually a good thing as it makes climbing that tricky housing ladder all the more practical."

Instead, house buyers should ensure that they don't over-commit themselves financially and focus on securing a property that is comfortable to live in.

And although recent research from MoneySupermarket.com suggests that the number of high loan-to-value mortgage products - which reduce the amount of initial deposit needed - has dropped, there are still good rates to be found for those who are prepared to shop around.

Ultimately, getting on the property ladder is all about doing your homework and making smart decisions.