Anyone who lives in London and who has had to rely on the rental market to date will know that buying that first property can seem like an impossible dream. Just getting together the size of deposit needed seems like an almost insurmountable task – but it’s obviously possible for the thousands who do manage it every year.
Another idea that has been dispelled recently is that first time buyers constitute an insignificant proportion of the property deals in the capital. In research carried out by Hamptons International, they found that between January and September 2019, 44% of property purchases were by first-time buyers and in the boroughs of Haringey and Newham, they accounted for over half of the recorded sales.
While the average property price in London may be over £471,000 according to Government figures, prices have fallen back slightly over the year. Many believe that it’s uncertainty over Brexit that has taken some of the heat out of the market with decreases reported as recently as November.
There is a feeling, however, that 2020 could see prices start to rise again, especially if we really do start to “get Brexit done”. If this is the case, then this could be the best time for a long time to pull out all the stops and buy a first property.
As mentioned, the biggest concern for most first time buyers is how to get a sizeable enough deposit. But lenders are now more willing to consider 95% loans and other alternatives for first-time buyers, including ones in which parents agree to act as guarantors. It’s a competitive market; however, with the advent of online services such as Trussle who offer free mortgage advice and root out the best and most appropriate deals, finding your way in this market has been easier in recent years.
As to whereabouts in London to try to buy, it’s something of a no brainer that the further from the centre you look the cheaper the properties will be. For example, according to research by Foxtons, Barking and Dagenham is the cheapest of the London boroughs with an average property price of a little over £300,000. Considering that this is still within Travel Zone 4 and well connected by the District and overground lines it would certainly be an area worth considering.
For those who are definitely looking for an area where property is likely to enjoy above-average increases in value over the next few years then a surprise candidate is Redbridge near Ilford. Over the next five years, properties are predicted to rise by up to 17% driven by the arrival of Crossrail to the area. So, the average flat in the area now, which costs a little over £384,000 according to Zoopla, could have increased in value to £450,000.
This really could be the perfect moment to make that leap – and, if the experts have got it right, in a couple of years’ time you’ll be very glad you did.