London Help to Buy- worth doing?

Petite_Anglaise

We are in the process of looking for somewhere to buy in SE London.

Everything proving to be very expensive indeed and certainly 2 bed houses are out of our league.

I saw this advertised in the Evening Standard- for a new development in a place called Lower Sydenham.

https://www.crestnicholson.com/developments/dylon-works/

What do people think? 40% loan from the government sounds crazy, you stump up at least 5% deposit and the remaining 55% or less is a mortgage.

It might be the only way that we can buy...but the prices are very high, not surprising as it's new build.

HTB is only available for new build properties.

Was thinking about going to take a look around as it launches this weekend...just trying to convince the other half that it might be worth considering as an option!

kingstreet

If you have a 40% loan, you repay 40% of the value of the property when you sell, not the £ amount you borrowed at the outset.

No payments for five years, then fees start in year six at 1.75%pa, then 1.87%pa, 2.0%pa and so on, assuming 5%pa inflation.

As long as you understand that and have an exit strategy you should consider it with your other options.

Petite_Anglaise

Yes I've had a look through the documentation online for London HTB.

We are really considering it as we'd like to get a 3 bed and it's the only possible way as any 3 beds on the open market are way beyond what we can afford doing it the normal way.

The 2 beds in this development are much less appealing as we could probably scrape our way to buying a 2 bed flat in nearby Beckenham with a conventional mortgage/deposit.

Do not know Beckenham/Lower Sydenham that well but we have been looking in the area for a few months now.

Petite_Anglaise

Update:

I managed to pop along after work yesterday.

Still a total building site but good to see the model/plans in 3D in the sales & marketing suite.

We won't be trying to buy something- it's completely out of our reach price wise.
3 beds are just under the HTB limit- by a fiver! so they are £599,995
2 beds are around £530,000

Ironic really as it's meant to be a scheme to help FTBs like us!
Back to the drawing board then

ap1985

That is crazy prices, but that is London for you. Would you consider shared ownership? That may be another way to get on the property ladder....Or maybe move just slightly outside London?

Petite_Anglaise

Yes indeed crazy prices!

I am keeping a a close eye on the website as I'm curious to see how many of the flats actually sell/get reserved.

Yes we've tried SO a couple of times, been to see the property (along with a dozen others!) and never managed to be top of the list.

Like bidding on a VERY expensive council house.

To be honest, I think SO is only worthwhile if you did it around 2 or 3 + years ago...you'll benefit massively from the rise in price and have a queue of people round the corner wanting to buy.
Even moving just slightly out of London is still £££ and you then have to factor in the extra travel costs/time.

KRB2725

What's your budget and where do you travel to for work? Somebody may be able to come up with an area you haven't yet considered?

elverson

If you can afford something in Beckenham I'd choose there over Lower Sydenham as it has more shops/facilities and transport connections.

Have you tried looking in Penge and Crystal Palace also?

Petite_Anglaise

Hi thanks for the replies, sorry not been on here much.

Budget is up to £350k at an absolute stretch, I guess more realistically around £330k.

I need to get to Canary Wharf area for work, husband needs to west end direction.

Yes Beckenham seems much more appealing than Lower Sydenham. Visiting the new build flat development was interesting, took a bit of a walk around but didn't really get a real vibe of the area.

The development is right next to the train station which is great (in some ways) but I'm not really sure about Lower Sydenham itself as an area- Beckenham by comparison seems to have a distant high street with all the usual shops & amenities.

Not looked at Penge or Crystal Palace- no reason not to, just feels a bit further away than we want to be- mainly proximity to train stations. We will ideally need to be able to get to Lewisham and change for the DLR (me really!).

bowlhead99

Being 'a bit further away than where you want to be' is par for the course really, if where you want to be costs £599,995 or £530,000 and your budget is £330,000

It probably won't help for me to say this, but the standard things to do when your budget doesn't stretch include reducing the number of bedrooms you want, reducing the desirability of the location you want to live in, and increasing the size of deposit you have. Or all three.

Generally in London these days a first time buyer's first step on the property ladder is not straight into a house with two or three bedrooms. It's a flat with one bedroom; two if you can really compromise on location or quality or have a big deposit as well as two incomes.

marksoton

And the London madness just carries on.....

I honestly, properly cannot understand why people bother. Insane prices, ridiculous commutes and professionals who end up eating cans of beans. You're nutters.....