Getting on the ladder: top 10 tips for buying your first home in London

Getting on the property ladder is daunting (Barbara Gibson )
Getting on the property ladder is daunting (Barbara Gibson )

Purchasing your first home in London without significant financial support from family can feel like more of an impossible task than ever.

Rents are rising to the tune of 12 per cent a year, while mortgage rates have spiked since interest rate hikes began.

But house prices in the capital are dropping, and with the Bank of England holding interest rates for the moment lower mortgage rates could be arriving in time for an emerging cohort of first-time buyers (FTBs).

According to exclusive research by estate agent Hamptons, despite an overall fall in buyers, it’s the FTBs who are making up the numbers. Some 45 per cent of buyers registering at Hamptons’ branches last month were FTBs – the highest proportion since the firm began recording this data in 2010.

With that in mind, here is a 10-step action plan to guide you to to your first home purchase.

1. Book in with a mortgage advisor

Your first step should be to see an (independent) mortgage adviser to understand how much you are likely to be able to borrow and if there are any issues with your credit rating that need fixing.

2. Begin reconnaissance

Research the areas you can afford to live in, go on recces and consider places you don’t know well along with favourite spots.

3. Think transport links

Despite the WFH revolution, good transport links nearby are always going to be important — to you and to future buyers.

4. Regeneration sensation

Buying close to an area being regenerated, like Brent Cross Town or Canada Water, can drag up property prices over time.

5. Plan ahead

Think long term. Buying costs are high, house prices flat (at best). So anywhere you buy now is going to need to suit you for a good few years.

6. Consider a lodger

An extra bedroom can earn you thousands of pounds per year to help offset your mortgage if you take in a lodger.

7. Get a guarantor

If your family can’t offer you cash, they might be able to help in other ways — like guaranteeing your mortgage.

8. Imagine the potential

Don’t expect a palace. Woodchip wallpaper can be stripped, dated kitchens replaced, colour schemes redone. Try to concentrate on the bones of the property, the size of the rooms and the quality of the light.

9. Beware the service charge

If you buy a home on a development you are going to have to pay a service charge, likely a couple of hundred pounds per month. If you buy a period conversion, or in a smaller block, your costs will be much lower — although you may have to share the costs of maintenance work.

10. Prepare to negotiate

Do your research on local property prices and, when you find a property you want, don’t be shy to negotiate.