Advice for First Time Buyer

hp2r

Im looking into purchasing my first home and have read through the free pdf on the moneysavingexpert website. I understand the financial aspect quite well but I need some advice as to whether now is the right time to buy in my situation.

I wanted to buy a house a couple of years down the line but I feel that my hand is being forced by the new mortgage guarantee scheme coming 2014. I feel fairly comfortable with my deposit (I can afford 20% now and possibly 25% very soon, taking into account fees and other costs etc) but I am a little more worried the new scheme pushing up house prices significantly. This would make my deposit go less further, thus making my mortgage more expensive in the long run.

Here is my situation:

• I earn 27k a year.
• I can afford a deposit of 20-25% of the house value
• I am looking at buying a house for 125k

I am correct to be concerned about the new mortgage guarantee scheme? As I understand, this scheme is designed for those with low deposits. However, I am more interested in low monthly payments.

Could I also use a mortgage broker (eg. London & Country) with no obligation if I change my mind about getting a mortgage or going with another broker?


Thanks.

monty-doggy

Most mortgage brokers will want you to sign for their services and will have a get out fee. If you can afford the 20-25% deposit, and you find the right property I wold do it now rather than wait for a scheme which you clearly don't need.

Building_Surveyor

You refer to the mortgage guarantee scheme. But you have a 25% deposit for a house price of £125k, what help is the scheme going to be for you? You don't sound like you need it.

maninthestreet

You have enough deposit to buy a property now if you so wish.
If you are worried about house prices rising beyond your reach, start looking at properties for sale now.

hp2r

Thanks for the replies. I wasnt interested in the scheme for myself. I just wanted some opinions on whether it would push house prices up, which judging from some comments here, it will.

I wanted to wait until I got a better paid job but I think I will go for it this year.

bigadaj

Would think the government schemes will have little effect on overall prices, they are there to support the market, ultimately property is currently over valued but it would appear that prices are unlikely to drop to any great degree, and will simply flatline as inflation erodes value.

This depends on what house you are buying and in what area, as there could be special circumstances in particular regions, but in general there will be probably be limited impact.