How important is First time buyer status?

TwoYearToMove

I'm 52. Never owned, always rented. In 2 years I should be in a position to get a mortgage on a 2 bed flat. However if I wait 2-4 years I might be in a position to get a bigger mortgage on a larger property, which is what I would be happier with. I know it's a long way out, but I'm self employed and have to plan far ahead. So what's better? Get a flat as soon as possible, use the first time buyer status on that place and then maybe a few years after that upgrade to a bigger place. OR. Is it better to just wait longer and use the first time buyer status on the more ideal place, in 3-4 years time?

kingstreet

From a mortgage POV it doesn't really matter.

From a SDLT/HTB ISA perspective it may be important depending on source of deposit, purchase price etc.

TwoYearToMove

kingstreet said:

From a mortgage POV it doesn't really matter.

From a SDLT/HTB ISA perspective it may be important depending on source of deposit, purchase price etc.

Stamp Duty was one of the things I was thinking about. I'd maybe save about 15k (300k place) by waiting.

The HTB is only for first time buyers? I was thinking about using the Mortgage Guarantee scheme (or whatever it's called from June 25 onwards).

The other thing I was wondering about was, having a mortgage already (on a 2 bed flat), after 2 years, when I want to sell it and upgrade to a better place, would look better (because I've been paying a mortgage for 2 years) than being a first time buyer going for a larger mortgage. But maybe it makes no difference.

born_again

Have you factored that most lenders will not go past 70 on a mortgage, so waiting 2-4 years may not get you a bigger mortgage. Due to shorter repayment time.

TwoYearToMove

born_again said:

Have you factored that most lenders will not go past 70 on a mortgage, so waiting 2-4 years may not get you a bigger mortgage. Due to shorter repayment time.

The plan is those few extra years will mean higher annual income and a bigger deposit, meaning I can get a more expensive place. But I can be in a flat wth a mortgage during that period, or I can just wait longer in renting accommodation and hold on to the first time buyer status.

p00hsticks

TwoYearToMove said:

born_again said:

Have you factored that most lenders will not go past 70 on a mortgage, so waiting 2-4 years may not get you a bigger mortgage. Due to shorter repayment time.

The plan is those few extra years will mean higher annual income and a bigger deposit, meaning I can get a more expensive place. But I can be in a flat wth a mortgage during that period, or I can just wait longer in renting accommodation and hold on to the first time buyer status.

In my view it's not so much holding onto the first time buyer status, but rather that it would probably be cheaper and certainly far less hassle to wait until you can make your long term purchase. If you buy something and then sell within two years you have two lots of buying and one lot of selling costs to consider, plus the complication of bein in a chain where you have to sell and buy at the same time for your next purchase. 

35har1old

TwoYearToMove said:

kingstreet said:

From a mortgage POV it doesn't really matter.

From a SDLT/HTB ISA perspective it may be important depending on source of deposit, purchase price etc.

Stamp Duty was one of the things I was thinking about. I'd maybe save about 15k (300k place) by waiting.

The HTB is only for first time buyers? I was thinking about using the Mortgage Guarantee scheme (or whatever it's called from June 25 onwards).

The other thing I was wondering about was, having a mortgage already (on a 2 bed flat), after 2 years, when I want to sell it and upgrade to a better place, would look better (because I've been paying a mortgage for 2 years) than being a first time buyer going for a larger mortgage. But maybe it makes no difference.

It's only upto the 25th of June

Jemma01

Where i live the prices aren't promising for flats, my neighbour sold with a loss despite waiting for a while. I wouldn't bother. But obviously, you need to research your area

35har1old

TwoYearToMove said:

kingstreet said:

From a mortgage POV it doesn't really matter.

From a SDLT/HTB ISA perspective it may be important depending on source of deposit, purchase price etc.

Stamp Duty was one of the things I was thinking about. I'd maybe save about 15k (300k place) by waiting.

The HTB is only for first time buyers? I was thinking about using the Mortgage Guarantee scheme (or whatever it's called from June 25 onwards).

The other thing I was wondering about was, having a mortgage already (on a 2 bed flat), after 2 years, when I want to sell it and upgrade to a better place, would look better (because I've been paying a mortgage for 2 years) than being a first time buyer going for a larger mortgage. But maybe it makes no difference.

Stamp duty zero rate is set to drop on the 25th of March to £300000 and with the new government that could change

Martico

p00hsticks said:

TwoYearToMove said:

born_again said:

Have you factored that most lenders will not go past 70 on a mortgage, so waiting 2-4 years may not get you a bigger mortgage. Due to shorter repayment time.

The plan is those few extra years will mean higher annual income and a bigger deposit, meaning I can get a more expensive place. But I can be in a flat wth a mortgage during that period, or I can just wait longer in renting accommodation and hold on to the first time buyer status.

In my view it's not so much holding onto the first time buyer status, but rather that it would probably be cheaper and certainly far less hassle to wait until you can make your long term purchase. If you buy something and then sell within two years you have two lots of buying and one lot of selling costs to consider, plus the complication of bein in a chain where you have to sell and buy at the same time for your next purchase. 

That'd be my view as well - two years is no time at all given the expenses around moving and fitting out a property

Jemma01

35har1old said:

TwoYearToMove said:

kingstreet said:

From a mortgage POV it doesn't really matter.

From a SDLT/HTB ISA perspective it may be important depending on source of deposit, purchase price etc.

Stamp Duty was one of the things I was thinking about. I'd maybe save about 15k (300k place) by waiting.

The HTB is only for first time buyers? I was thinking about using the Mortgage Guarantee scheme (or whatever it's called from June 25 onwards).

The other thing I was wondering about was, having a mortgage already (on a 2 bed flat), after 2 years, when I want to sell it and upgrade to a better place, would look better (because I've been paying a mortgage for 2 years) than being a first time buyer going for a larger mortgage. But maybe it makes no difference.

Stamp duty zero rate is set to drop on the 25th of March to £300000 and with the new government that could change

Thanks for that, I didn't realise :O 
I hope my current purchase moves along, it'll hit me really hard :O