Newspaper article The Evening Standard (London, England)

Right from the Start; Sara Yates Reveals the Good and Not-Sogood Ways to Pay for Your First Home

Newspaper article The Evening Standard (London, England)

Right from the Start; Sara Yates Reveals the Good and Not-Sogood Ways to Pay for Your First Home

Article excerpt

Byline: Sara Yates

THE title to the long-awaited White Paper, Fixing Our Broken Housing Market, promised a lot, but mainly repeated the Government's existing policies, while new proposals appear to miss the mark.

Halifax data show the average price of a first-time buyer home broke the PS400,000 mark last year. The mortgage required to buy a home of that price is simply unaffordable for many starting out. To make the maths work, Londoners buying for the first time are, on average, putting down more than a PS100,000 deposit. This is a great solution for those with amazing savings or access to the bank accounts of Mum and Dad, but it is not available to all.

shared ownership may not be the answer Shared ownership continues to be a popular scheme. This allows people to buy 25 per cent to 75 per cent of a property and rent the rest. The good news is that the deposit needed is only 10 per cent of the share you buy, not the whole amount, making it much more achievable for most young Londoners. The scheme is available to households with an income below PS90,000 and is popular, so expect to have to move fast when you find what you want. The downside is that repaying the mortgage, as well as paying rent and service charges, means high monthly outgoings and there is usually a minimum income requirement of at least PS40,000 a year help to buy equity loans Available for new builds priced below PS600,000, the government lends you up to 40 per cent of the property's value, reducing the mortgage you need to raise to 55 per cent (assuming you have a five per cent deposit). Things to remember: you have to start repaying for the loan after five years and it is linked to inflation, so could be chunky. Second, the equity stake is repaid when the house is sold and could be a much larger amount than the initial sum.

help to buy isa This really is free money! …

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