First Time Buyers - a step by step guide

Buying a property is a major life event and  first time buyers especially,  need extra advice and reassurance. We make sure that first time buyers are given the explanations they need at each stage in the process. If you are thinking about making a purchase in the future and need some advice now, please do not hesitate to get in touch – we would be happy to talk you through your concerns. For first time buyers advice ask for Sean Sanders on 020 8290 0440 or email: sean.sanders@thackraywilliams.com

Ownership of property

You can own property of any type jointly in two ways, either as ‘joint tenants’ or as ‘tenants in common’.  We will give you advice on which would suit your circumstances best. Ownership as joint tenants means that on the death of one of the owners, the property automatically passes to the surviving owner.  If you own as tenants in common, you own a specific share which forms part of your estate and which you can therefore give away in your Will.

What you need to consider when planning your purchase

A deposit
This was traditionally between 5% and 10% of the purchase price, but recently some lenders have insisted on much more. The higher the desposit you pay, the lower your interest rate will be.

Getting a mortgage
We can point you in the right direction and recommend financial advisers who can assist you. We can also assist in re-mortgage quotes and provide you with further details to suit your needs.

Costs of purchase
These will depend on the purchase price.  We can provide you with an immediate, without obligation quote.

Survey
These can range from a simple valuation report to a more detailed Homebuyer or full structural survey.  We know local surveyors and can recommend some to you.

Stamp duty
1% if the purchase price is over £125,000 up to £250,000
3% if the purchase price is over £250,000 up to £500,000
4% if the purchase price is over £500,000
5% if the purchase price is over £1,000,000 effective from April 2011.

*Stamp Duty exemption for first time buyers on property with a purchase price below £250,000 between 25 March 2010 and 25 March 2012. However the definition of a First Time Buyer is very strict and the following qualifications apply:

1. The purchaser must intend to occupy the property as his or her main residence (investment or Buy to Let properties do not qualify).
2. The purchaser must not have previously owned an interest in land (which includes residential property) anywhere in the world.
3. If there are joint purchasers then they do not get the exemption if one of the joint purchasers have previously owned an interest in land (all of the buyers must be first  
time buyers).
4. If an individual has inherited an interest in land previously they also do not qualify for the exemption.

Energy Performance Certificate
This assesses the efficiency of your property
from an environmental point of view. Ask the seller or their agent to see it.  When you sell we can arrange this on your behalf.

Leasehold property
Check the length of the remaining term of the lease and always ask the estate agent before making an offer to purchase.  Always find out the Ground Rent payable and the service/maintenance charges.

Costs of owning the property
Ask the estate agent or the vendor the amount of the Council Tax, water rates and estimates for the buildings and contents insurance.

Shared Ownership Schemes (part buy, part rent)

Shared ownership schemes are administered by Housing Associations and are designed to help people who cannot afford to buy the home they need. In most instances, key workers, existing council/ housing association tenants and people registered for housing with the council, are given priority. Most shared owners are first time buyers. The scheme is not available to people who can afford to buy a home on the open market.
The size of the share purchased is normally 50% although smaller or larger shares may be available. Shared owners pay a monthly rent to the Housing Association for the share they were unable to purchase. In addition, there will normally be a service charge to cover items such as buildings insurance, management and cleaning of any common areas.

 Key workers are given priority in shared ownership schemes.  Key workers are listed below:

• Clinical National Health Service (NHS) staff (with the exception of doctors and dentists)
• Teachers and nursery nurses in schools and further education/sixth form colleges
• Police officers, Community Support Officers (CSO) and some civilian police staff
• Prison officers and some other staff 
• Probation Service staff
• Social workers, nursery nurses, educational psychologists, and therapists (e.g. occupational therapists) employed by local authorities, Children and Family Court Advisory and Support Service (CAFCASS) or the NHS
• Local Authority Planners and Environment Health Practitioners
• Firefighters and other uniformed staff below principal level in Fire and Rescue Services
• Connexions Personal Advisors employed by a local authority or a Connexions Partnership
• Ministry of Defence (certain personnel) 
• Highways Agency Traffic Officer staff in safety critical roles within the Traffic Officer Service.

For more information about Shared Ownership Schemes contact a local Housing Association.  In the Bromley area these are:

• Broomleigh Housing Association
• Hyde Housing Association
• Kelsey Housing Association
• Penge Churches Housing Association Ltd
• Keniston Housing
• Tower Homes Ltd