How do I find the perfect property?

Buying a home is one of the biggest and riskiest decisions you must make in life, and it really is worth putting in the effort to make sure you get it right. A lot of people make mistakes in buying homes, which can affect your well-being, be a major hassle – and be very expensive.

You should only start choosing a property once you confirmed the area you want to live. There is no point in having the right property in the wrong area.

Plan for the long term

If you are a first time buyer, you might just want to get your foot on the property ladder and move on in a couple of years.  But most people end up living in their homes for many years, and it is vital to factor that in. If you don’t buy a home that is future-proofed, you can end up having to move more frequently, which is incredibly expensive.

  • Ensure it is a home you will grow into. People tend to like having more space as they grow older
  • If you are planning kids, or more kids, do you have enough bedrooms, and a garden? Living at the top of a staircase might not matter if you don’t have kids, but could be an impossible barrier with a pram
  • Think about conversions or changes you might make to the property – you don’t have to do them all at once
  • Can you build into the loft or other undeveloped space?
  • Furniture and home improvement costs wither away after the first few years
  • Unless you lose your job or stop working for other reasons, you will almost certainly enjoy earnings that rise steadily year on year throughout your life
  • The cost of a mortgage does not increase year on year, varying at most with interest rates.  That means that your mortgage will get steadily more affordable as a proportion of your income year by year
  • Barring personal setbacks, a property that was difficult to afford when you bought it will almost always be more easily affordable five years later
  • You can change the colour scheme easily, but there is nothing you can do about the total floor area in a first floor flat
  • Can you envisage developing the property over the years – is there room for extensions, or loft conversions?
  • Ugly features might depress the value, but can be very cheap to remove
  • Changing narrow corridors or awkwardly shaped rooms can be impossible

Stretch yourself

All other things being equal, owning a home almost always gets steadily more affordable every year you live there.

Focus on the fundamentals

Make sure you distinguish between what is superficial and what is fundamental. For example:

Learn everything you can about the property

Once you have your eye on a property, learn as much as you can about it.

  • Ask the estate agent smart questions about the property.
  • When you go to view the property, make sure you check out the right things.
  • Rival estate agents will often dish the dirt on a property, particularly if they have previously had it on their books and failed to sell it
  • Sometimes you can contact previous owners, who no longer have a vested interest in talking it up – this can be particularly informative if you suspect there might be problems with it
  • Ask the neighbours. Knock on their door and tell them you are thinking of buying the house next to them – most people will be delighted to speak to prospective new neighbours. If they aren’t, that tells you something too

 

What to look out for when purchasing home no. 2?

Dreaming of buying a second home? There are many pitfalls to take into consideration before taking the plunge of purchasing your 2nd home.

Many believe that buying and owning a second home is a piece of cake.

This can be the case if fortunate enough to find the right property which suits your lifestyle and needs. And of course within your price range

In reality, there is a whole load of obstacles just waiting to shatter your dreams.

Below are some points to consider before taking the plunge of purchasing your 2nd home:

Purpose

Buying a home can be very stressful time consuming and takes a lot of money,  so sit back evaluate why you are actually doing it.

If it’s a  home to retreat to on the coast or in the countryside then consider how often you will visit it. If realistically this only going to visit a few weekends during the summer then it might be an idea to looking into a timeshare or as simple as booking a place through a holiday company.

If you’re buying a property for rental purposes, you need to consider who is aiming to rent to and do extensive research on the local rental market.

Take notice are letting agents windows, full of the same properties they cant rent out?
Then possible the rental market is not as strong as the marketing people have you to believe.

Location

Parents buy student houses in the town where their offspring are going to university so they can provide them and their new friends with a place to stay and make some extra cash into the bargain. But need to consider if offspring is 200 miles away, and then having to maintain the property will start to become a stressful task with a mammoth commute.

And what if you need to hire a local tradesperson who you can trust to do a job properly without ripping you off? This is a whole lot more difficult if you don’t know an area at all.

student market is not to be scared of, just consider somewhere closer to a home where you can keep an eye on things in person, you know the area and hopefully have a network of local tradespeople who you trust and can tap into.

Professionals sometimes buy a smaller property close to work while their main residence is out of town which they only stay in over the weekends.

Make sure you have a good scout of the area and look for potential problem spots – are there student halls nearby? Is the area full of noisy bars and nightclubs? How far is it to the main train station for that quick getaway on a Friday night?

COST

Unfortunately, this is the part where major problems can start before you have even acquired your second property.

Have you found that dream second property but the budget is tantalisingly just out of reach unless you make some big sacrifices elsewhere in your life?

If you have the money to buy something outright but it’s not quite what you want, should you go down this route instead?

The key thing is to sit down with your calculator and be brutally honest with yourself about what you can and cannot afford.

If you are planning to take out a second mortgage then have a cap in mind as to what you can afford.

Factor in a buffer for unforeseen circumstances as items such as broken boilers can come with eye-watering bills.

There are tax implications to buying a second property too.

Since April 1, 2016 there has been a three per cent stamp duty surcharge in place on second homes.

It works on a tiered system so second homes with a price tag under £125,000 now attract a three per cent charge instead of zero per cent.

Properties between £125,000 and £250,000 now have a five per cent rate (up from two per cent).

For the super wealthy, second homes carrying a price tag of over £1.5 million will be attracting a 15 per cent charge, instead of 12 per cent.

Funding

Should you remortgage your first home or use it as a guarantee to finance the second property?

What type of mortgage can you get on a second property and will this be dictated by its use, e.g. buy-to-let?

Timing is a big thing to consider.

Maybe you’re due a big promotion at work so you would be able to double the size of your deposit by just waiting for a year or two before taking the plunge and buying that second property.

Condition

This is a difficult one as the old adage about ‘getting what you pay for’ applies just as much to property as it does everywhere else.

Sure, a cute but run-down, neglected cottage in the middle of the country may well look like the bargain of the century but, if it needs tens of thousands of pounds spending on it to make it inhabitable, then it could be a poisoned chalice.

If you are very practical and skilled then this could be the way forward but for those who don’t know one end of a chisel from the other, then the financial and mental costs of trying to spruce up an old property yourself can be both prohibitive and ultimately counter productive.

This is a tricky line to tread so think about how much budget you have to play with when it comes to renovating the property and that will dictate how run-down, and therefore cheap, your purchase can be.

Extras

Unfortunately, the cost of owning a second property doesn’t end once you have signed on the dotted line and taken delivery of the keys.

If you are using your second property yourself, as opposed to entering the rental market, then you will have to cover everything there as you would at your main residence.

This includes items such as house insurance, broadband, telephone and TV licence and that’s alongside general, day-to-day bills like electricity and water.

Sure, these shouldn’t be anywhere near as high as at your main abode, especially if you are only using your second home for a few weekends a year, but it will probably still need heating throughout the winter to stop the pipes freezing whether you are there or not.

This should form part of your budget planning when deciding how much cash you have to play with.

Shared ownership

One way to share the burden, stress and cost of buying a second property is to team up with some family members or close friends (but pick some you can trust).

Banks should be receptive to having multiple names on a mortgage contract provided you can prove that everyone has the financial means to keep up with the repayments.

 

 

First-time buyers are priced out as number of flats sold in London tumbles

London’s flats have decreased in sales as the prices are out of reach for ordinary first-time buyers, according to new research.

According to figures from Home.co.uk, which analyses data from the Office for National Statistics and property portals, which the number of apartments sold in the capital fell by 47pc in July compared to 12 months previously.

The number of detached properties sold in London fell 5pc in 12 months to July this year, with sales of terraced houses down 8pc. This comes amid a general slowdown in the level of transactions across the country, and particularly in London.

According to the Land Registry, the average price of a flat in London increased by 3.9pc in the 12 months to July to £434,587. The price growth of flats is outstripping all other property types across the country, partly due to a lack of supply, being led by the rises in the capital.

With the slowdown in sales signals that affordability has been crunched and many first-time buyers, who would typically purchase these properties, are sitting on their hands and waiting for a correction in prices. 

While the Government’s Help to buy scheme has allowed many first-time buyers across the country to get on the property ladder with a 5pc deposit, the take-up in London has been far lower. The threshold of £600,000 means that many newbuild properties are too expensive to qualify and analysis by the BBC earlier in the year found that while Help to Buy is used to buy one in three new-build homes outside London, in the capital it is just one in 10.

Other natural buyers of these properties, buy-to-let landlords, have also been squeezed by changes to the tax regime and many are sitting out buying opportunities or selling up their portfolios.

Lucy Pendleton, the founder of estate agency James Pendleton, said: “Solid numbers of people are showing some reluctance at current prices and signaling to all the other market participants they can’t transact unless they come back down to earth.” 

A correction could soon be coming: data from Acadata and LSL property services found that prices in London have fallen the most since the financial crisis. Average property values have fallen 2.7pc in the year to September, the most since 2009.

 

New build vs. Second-hand homes in London: house price report reveals six-figure gap between new and resale flats

There’s a huge gulf between the average price of old and new-build flats in London. New builds can offer peace of mind while ex-councils flats are best for value so weigh up the pros and cons carefully before you buy.

Ex-council vs. new-build prices in every London borough

The six-figure price gulf between new and resale property, and between privately built and former council homes, is revealed in a new study focusing on London.

Research comparing the cost of one-bedroom flats in every borough shows pre-owned homes cost an average £542,715, while a new-build one-bedroom flat costs an average £679,671. That’s 22 percent — or almost £137,000 — more.

An ex-council one-bedroom flat is the best value of all at £396,317 on average, the Hamptons International study shows. This is more than £146,000 — or 31 percent — less than buying a privately built flat, and more than £283,000, or 52 percent, cheaper than a new-build flat.

New build is always the premium buy, for the peace of mind that comes with a modern, well-insulated home, often with such extras as communal gardens and sports facilities. In today’s tricky market some developers are offering good deals such as paying buyers’ stamp duty to stimulate sales, but the property will always come out more expensive with annual service charges on top.

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New — what £350,000 buys you: a flat at Leven Wharf, Poplar, with a terrace and city views but only one bedroom. For sale with My London Home (020 8012 5708)

Not long ago you could have said a new-build flat, bought off-plan, would make you a profit by the time you moved in. The direction of the current market is anybody’s guess because of stamp duty hikes and the fallout from the Brexit vote.

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Adrian Plant, director and head of new homes at estate agents Currell, says: “With the new build, you hope you know that for the first 10 years there will not be any major costs. You won’t need to pay for builders and plumbers, and many developments now come with a concierge to handle maintenance and sort out issues like arranging for parcel delivery or laundry, at a cost of service charges.”

Buyers of older homes pay less to purchase, but often then stump up for renovations and/or extensions. Of course, an older home may bring the bonus of period features such as cornicing, wide staircases, stained glass and Victorian tiled floors.

WITH GREAT VALUE COMES GREATER RISK

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Old — what £329,999 buys you: a second-floor ex-council flat with two double bedrooms in Clapton E5. Former council homes can be great value, but ask locals what life on the estate is like before you commit to buying

Ex-local authority homes are fantastic value but this is the riskiest sector to buy into. Generally, those built before the Sixties and Seventies are higher quality and larger than a more modern home. But on estates blighted by years of underinvestment, flats can be shabby, common areas depressing and getting a mortgage can be a pain.

However, Stephen Lovelady, sales manager at Foxtons’ Pimlico and Westminster branch, says ex-council homes on his patch are often well built, with good security and sometimes well managed. He says most lenders will offer mortgages on ex-local authority homes in central London, although some will not lend on buildings above six storeys, or of poor construction standards.

READ MORE

Beyond Zone 1, broadly speaking, lenders are happy with ex-council homes in desirable areas and less keen on run-down locations. Buyers must research whether there are any major repairs planned for the block or estate because they, unlike the council tenants, will have to pay a share of the cost. Request a work plan from the local council which will give a five-year list of any projects plus an estimated cost. Your solicitor should investigate any major works when conveyancing your sale.

Communal halls, lifts and walkways are often grim. Bad management, crime, drugs and gangs of teenagers making life a misery are all possibilities on a big estate. A safer bet is a small, low-rise block that’s well integrated into local streets, although this might be more expensive than average.

So before you buy, contact the tenants and residents association to discuss any major problems, knock on doors and chat with residents, talk to the local paper, study police crime statistics and visit the flat during the day and at night.

 

5 THINGS TO LOOK FOR IN A FAMILY HOME

When hunting for a nice property as parents there are things you’ll be keen on looking for in your new home. So are obvious, such as schools, gardens and the area. But here are some of our top 5 alternative things to especially look for in family homes.

TIP #1: If no gardens, look for parks

Ideally, for a family home, you’ll be looking for a place with a good size garden so that your children have the option of playing outside of the house. But as there is a demand/increase in flats/apartments, families are just about missing out on gardens. So if you are one of those families, we recommend that you look into a property that is easily accessible to the local park, so that your children still are able to play outdoors.

TIP #2: Family friendly facilities and recreation centres

The rising use of technology means that this generation of children already have their recreation sorted on mobile devices. However, if you’re looking to discourage the over the use of technology as recreation for your children, then look for the possibilities of having recreation centres, family friendly cafes and facilities that are local to your forth-coming family home.

TIP #3: Well insulated homes

In order to decrease the number of runny noses and ticklish coughs, we recommend that families look for properties that are well insulated or have a good central heating system in the home, as this will help keep the warmth in during those colder miserable days that we tend to have in the UK.

TIP #4: A good kitchen

When we were looking for our family home, one thing my parents especially my mum looked for was a good kitchen and that always stuck with me. A sizeable kitchen with a well-tiled wall was on the top of her list, as families tend to do more cooking throughout the weeks that the walls become accustomed to the steam, heat and smells. So we recommend looking for a kitchen with well-insulated walls, a breathable space and also a good/replaceable air vent.

TIP 5: Good structure/sizing

Regardless of the type of property, we suggest a good sized space that will allow for children to freely express themselves throughout the home. This will decrease the number of inconveniences and also avoid that claustrophobic feeling of having furniture/storage space crowding up the place.

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Also if you have any tips that you could recommend to us, share them in the comments and we’ll be highlighting them in our upcoming articles in the ‘Family’ series.

 

This is set to be positive year for Aberdeen’s commercial market

The political landscape and predictions are widespread over how the snap general election could affect the markets. With Scotland dealing with the negative impact on property investment and market confidence amongst some investors and developers because of the prospect of a second independence referendum.

However, in Aberdeen, the atmosphere has largely driven by the fortunes of the oil and gas industry for the past two years, with the sector now showing largely positive signs. But not to say the wider political backdrop is of no concern, the UK’s vote to leave the EU immediately benefited Aberdeen’s oil and gas economy. The North Sea producers have profited from production costs being incurred in a depreciated sterling relative to a product sold in US dollars, as have local service companies pitching for business around the world conducted in a largely dollar-denominated market. With a growing confidence in the local air which is now impacting itself in our property market.

The office sector was a most impacted sector by the energy industries. The fortunes between 2013 and 2015 fluctuating and with the best quality space have maintained headline rents and interest from occupiers despite carrying a record level of voids. However, it must be said that much of the remaining stock has seen its day, being functionally or economically challenged or located on peripheral estates which have long been a unique feature of Aberdeen’s property supply.  

In comparison, Aberdeen’s industrial market has held up reasonably well. During 2016, take-up was in line with the 10-year average with rents generally remaining stable although the supply of second-hand stock has increased.

Investor appetite for Aberdeen is beginning to show signs of increasing. A North American investor, for example, acquired the Lloyd’s Register building in Prime Four Business Park for £41 million in February, pushing Q1 office investment levels to £49 million, more than the total volume recorded during 2016. Investors are seeking a ‘flight to quality’, looking for well let assets in the city, which may offer more attractive yields than elsewhere in the UK.

The good news is that office lettings in Q1 2017 were 181,000 sq ft (16,815 sq m), the highest quarterly take-up since Q3 2013. This clearly indicates that the local mood has moved up a gear, in part reflected by oil companies Total and Marathon committing to new leases and a number of large requirements circulating.

The further positive news comes with Hurricane Energy announcing a new find west of Shetland with estimated recoverable reserves of a billion barrels and small local independent Chrysoar announcing a $3 billion acquisition from Shell comprising 10 separate assets in the UK continental shelf with funding from US private equity firm EIG Partners.

The smart money is clearly backing a more positive future for Aberdeen and the property market is starting to reflect this.

 

7 THINGS YOU SHOULD BE DOING PRIOR TO MOVING INTO YOUR FIRST HOME

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As a first-time buyer, the responsibility can be quite daunting when moving yourself and your belongings into your new haven. Fortunately, for you, the buying process is made easier if you used the more traditional method, via Estate Agents. However, as soon as the keys are in your hands, the responsibility is yours!

So we’ve curated and listed below, our top 7 tips that we believe you should be doing prior to moving into your first home:

TIP #1: Change your address

There is nothing more annoying than having your utility bills, doctors’ appointments and random promotional letters being sent to your old address. Not only is it annoying for you to go back and forth to collect post or have your previous neighbours (family) have to update you on your letters that are flooding in, but it also means that your life is still registered at your old address.

So make sure you’ve updated your Driver’s License, Doctors, Water/Gas Providers or whoever it is that you’ve moved. I can tell you from experience it definitely saves you a LOT of hassle!

TIP #2: Change the locks

Now that the victory key has been placed in your palms, it’s time to throw it away and get a new one. No seriously get a new one!

Estate Agents, tradesmen, previous owners, neighbours, cats and dogs, whoever who may have had access to the house prior to you owning it will probably still have a spare key to your new home lying around. So for your sake and the sake of your sanity; have the absolute reassurance that no-one but you can get into your new home, look into getting new locks installed ASAP.

TIP #3: Spring clean the place

Whether you bought the property in Spring or not, give the place a good scrub. You might be lucky and have the previous homeowners clean up the place for you, but it’s still best to add your touch to the cleaning as you can definitely be certain that your new home is nice and clean, ready for you to decorate.

TIP #4: Don’t throw it away, paint it

If you happen to have a surprise chest of draws left in the masters’ bedroom and you don’t know what to do with it, definitely don’t throw it away!

You may not be excited about the colour or hardware of the leftover furniture, but upscaling and adding your own style to it can definitely reinforce that rewarding feeling of owning something as well as saving you money, but you can also brag to your friends about your handy work. So don’t throw it. Paint it. Style it. Repurpose it.

TIP #5: Get familiar with the community

Now, I’m not saying that you have to attend community meetings 6 weeks consecutively prior to your move or sign up to all the local clubs so that you can become familiar with everyone in the area and have Julie who lives across the road fill you in on the community gossip. I mean if you want to do that you can, and I’m sure Julie wouldn’t mind filling you in.

But rather, we suggest that you acquaint yourself with the local transportation, get a clearer understanding of the local shopping/market on offer and familiarise yourself with the key hotspots/locations around the town. It will save you a lot of mindless confusion and time. So you don’t necessarily have to research the communities’ historical records or look for a Julie.

TIP #6: Check the hardware around the house and mechanical equipment is serviced

Even though some Estate Agents offer those additional services and can recommend to you servicemen/traders to do the job before your move, it’s even more beneficial if you keep on top with the condition of the gas cooker or that the heating and cooling system are still running nicely and have had a good clean.

TIP #7: Throw a party!

Even though this tip applies more when your home has properly been furnished, it is one of our top recommendations.

Invite some friends over for a meal or a drink, not necessarily a party as you might have that one friend who after one or two drinks may decide to wreak havoc among your nicely decorated china display. A get-together is a good way to celebrate your achievement and also make your home homier.

So these are the main things we would recommend you budding first-time buyers consider doing when moving into your new place. Also, an additional checklist would come in handy (that’s a bonus tip), we’ll be providing you with one of your own checklists in the coming weeks!

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Also if you have any tips that you could recommend to us, share them in the comments and we’ll be highlighting them in our upcoming articles in the ‘First Time Buyers’ series.

[Opening image sourced from Martin&Co Chelsea listing, check out the property now http://bit.ly/2xuSeEK]

Abbeywood where house prices are way below the London average and price growth is strong at the Crossrail hotspot!

Abbey Wood SE2 postcode has grown by an impressive 76 per cent in the last five years, but the average remains a relatively modest £309,560.

Buyers have been pouring into Abbey Wood in anticipation of next year’s launch of Crossrail — the Elizabeth line — which will cut journey times to central London by almost half an hour.

While the area is not a thing of beauty and boasts few amenities, it has streets of good-value period terraces where a three-bedroom house would cost £375,000 to £425,000. You could get a slightly dated purpose-built two-bedroom flat in Abbey Wood for about £250,000.

The research by Bairstow Eves, using Countrywide data, evaluated average prices in every postcode in London. Then, concentrating on the cheapest 25 per cent of postcodes, it analysed their one-, two-, and five-year price growth to establish the areas where prices are on the strongest upswing.

Bellingham and Catford (SE6), an area well-placed to link to Crossrail services via neighbouring Forest Hill, has performed almost as strongly, with prices up 71 per cent in the same period, to an average £380,641.

For buyers on really slim budgets the bargain basement postcodes are Thamesmead, just north of Abbey Wood, where average prices stand at £252,747, up 60 per cent in five years, and Dagenham (RM10) where prices have grown 66 per cent to an average of £270,878. The once-desolate Thamesmead Estate is currently the focus of a £1.5 billion regeneration. Housing association Peabody was granted planning permission for the first phase of its transformation of the area late last year. There are also plans to link it to the London Overground.

Predictably, none of today’s leading areas are in Travel Zones 1, 2 or 3, where  nothing qualifies as affordable. More than one in three are perched on the outer fringes of London – MitchamDagenhamHarold WoodWellingSuttonNortholtWest Drayton, and Uxbridge. Their low prices combined with good transport links have been tempting an increasing flow of buyers priced out of more central locations, pushing their prices upward.

NORTH LONDON
Nowhere in fully priced west London makes the good-value grade, but representing north London are 
Tottenham (N17), where prices have mushroomed 67 per cent to an average £347,486 — and where billions of pounds worth of regeneration money is being spent on new homes and facilities — and its near neighbour Upper Edmonton (N18) where prices stand at £316,045, up 66 per cent.

The location of London’s cheapest neighbourhoods is a bellwether for change in the capital,” said David Fell, research analyst at Countrywide, who believes that as these regeneration schemes take root further growth is likely.

Over the last 20 years the most affordable neighbourhoods in London have been pushed steadily outwards and eastwards as swathes of the inner city reinvented themselves. Some of the cheapest corners of the capital in the Nineties turned into the boom towns of the Noughties, changing beyond recognition in the course of two decades.

It’s likely to be a similar story for some of today’s cheapest neighbourhoods in London. The arrival of Crossrail and the extension of the Overground will soon plug swathes of south and east London into the rest of the capital. The prospect of these new links is already bringing a wave of new development to some of the furthest-flung corners of the city. Within a decade it’s conceivable that the capital’s cheapest neighbourhood could pop up in west London for the first time.”

 

What first-time buyers need to know

There is always a first time for everything, and that even includes buying a house. According to recent reports in the Telegraph, the average age of a first-time buyer is around 30.  More and more young people are being forced to rent for long periods of time.  What was once a temporary source of accommodation is fast becoming a long-term solution.

So, for those first-time buyers out there who are about to step foot onto the property ladder, a little advice and ‘need-to-know’ can go a long way.  It can be a daunting time for anyone, let alone someone who is investing their life’s savings into a property for the first time.

Here are just a few things that first-time buyers need to know:

How are your finances?

Do you have good credit history? Do you keep on top of all your purchases and spending?  Now is the best time to really look at what you are spending and where your money is going.  Moving house is not cheap.  There are solicitors fees, stamp duty fees and of course, you will want to have money to buy new furniture too.  All those added extras that are on top of your deposit.

Getting a mortgage is tricky these days.  It has probably never been so tough to get a mortgage as it is now.  So make sure you are one step ahead of the game.  Get your finances in order, pay off any outstanding debts that could go against you and make sure you are on the electoral register.  Yes, even being on the electoral register will stand you in good stead.

Don’t stretch yourself too far

That three bedroom family home with the beautiful garden will always be appealing.  But if it is way out of your price range then it is best not to stretch yourself too far. Know your limits and work within these.  Speak to a mortgage advisor who will be able to help you understand how much you can realistically afford.  Remember, you still need to eat and live once you move into your new home.

Get the right mortgage

Getting a mortgage means shopping around.  An independent financial advisor will probably be your best bet.  They are independent because they are not tied to a bank or building society.  So this means that they have access to the best deals.  This is a chance for you to be really open and honest about your finances and to get the best mortgage rate you can.

Use Property Property Property

By using a portal such as Property Property Property you will be able to find the right home for you.  You can search by postcode or place name and search within a price bracket that suits.  Here you will find plenty of information, pictures and details on the properties you plan to view.  You can even email them to a friend or partner to let them know what you have been looking at.

At the end of the day, it is all about finding the right property at the right price for you.  And, as a first-time buyer you need to take as much advice as you possibly can.

How do I extend my lease?

In England and Wales, we have influential laws that allow you to extend your lease for reasonable prices. To help you extend your lease, we have put together some tips:

What is a lease?

The most common form of owning a flat or apartment in England and Wales is by leasehold. A leasehold means that you are essentially renting the property for a certain amount of time.

Who can extend?

The majority of flat owners can extend their lease and are entitle to get 90 years added to the lease under the 1993 Leasehold Reform Act. You have to have owned the flat for at least two years before you can extend the lease. You don’t necessarily have to live in the property, but rather just have owned it for 2 years. Bear in mind however that prices can soar for short leases.

Should you extend?

One of the most valuable reasons to extend a lease is that by adding a decent length of time onto the lease, the value of the property will inevitably be boosted. When people decide to extend their lease, it is typically by 90 years. Make sure to check how long is left on your lease as anything below 60 years will be unmortgageable and will likely have to be sold at an auction.

If you have more than 90 years left on the lease, then the value added to the property if extending will only be a tiny bit more than the costs occurred. However if you have over 90 years remaining on the lease, then you shouldn’t really in any rush to extend the lease. If you get to the 83 year mark, then this is a time to start considering extending.

If the lease 80 years or less

A major factor to remember is that when a lease gets down to 80 years, the price of extending will be greater so try to extend the lease before this mark. You can not rely on the freeholder to notify you when the lease drops to 80 years as they will make money from this due to you having to pay 50% of the property’s ‘marriage value’. Remember to start consider extending the lease once it has hit the 83 year mark, or better yet… extend the lease at the 83 year mark. If you are looking for a property, then you should check how much time is remaining on the lease and question it if it is 80 years or below.

How much will it cost?

This all depends on the property’s value, the length left on the lease and ground rent. Remember that costs can vary dramatically, so you might be best to ask a solicitor which you can find on the Law Society website. Another option is to ask neighbours in your building how much it cost them to extend their lease and what was left on the lease.