Help to Buy Mortgage London Can i Afford?

Frustrated_1_2

Hi All,

First time buyer here desperately needing some advice on the help to buy scheme among other things.

My stats:

Age:30
Salary:42k
Deposit:37k
Help to Buy ISA:3k
Other savings for associated fees:£7k
Mortgage agreement in principle: £345k, 38 years, min deposit 47k (this agreement was given to me last august when i was earning 40k per year)
Affordability: 345k with Help to Buy and 230k without Help to Buy.

I live in North London and have always wanted to stay in north London. I unfortunately still live with my parents . I have been looking for over 5 years but every time i find a flat im told by an advisor i cant afford it and i should save up for a bigger deposit but as soon as i do house prices increase also and im back to square one!

The Help to Buy option seems the only way for me to stay in Enfield or Barnet and live in a decent 1 bed flat with parking. I have seen a flat over the weekend for 350k, £1,500 service charge and £250 Ground Rent. Amazing looking flat everything brand new with a high spec on all appliances and materials/finishes. I really want to bid but im taken aback since i have been reading up on opinions of the mortgage by economists and financial advisers who all agree the Help To Buy mortgage is a con and will put people into more debt after the 5 year interest free period also could cause the financial bubble to burst! Furthermore, i have read 95% of Help to Buy mortgages have been taken outside of London. Only 7,500 Help to Buy mortgages have been taken out in London. Also The estate agent who i saw on Saturday told me she had 30 people to view the block of 15 flats that i viewed yet when i asked her today has anybody had put an offer for any 2 of the 1 bed flats she said no! Shouldnt these flats be getting snapped up?

My plan was to take a Help to buy mortgage and sell the flat before the interest free 5 year period is up and then buy a flat with a normal mortgage.


Buying the Flat

Flat price 350k
40% HtB Loan @ 140k
40k Deposit
170k Mortgage

Selling the Flat in the 4th or 5th year (estimation)

Flat Price 375k
40% HtB Loan @ 150k (pay back in one lump sum)
225k (retain)

Im just wondering if everyone knows something i dont and that i may be making the biggest mistake of my life by going ahead with a Help to Buy mortgage! I mean it seems very good so why arent more people taking it? Do you think i can afford it? I was trying to get a 3 year fixed rate also.

H E L P!