In conjunction with our friends at OnePoll, we surveyed one thousand 18-24 year olds and asked them, at what age do you think you’ll buy your first home?
A staggering 63% of 18-24 year olds who took part in the survey thought they would buy their first home between the ages 16-30, just under 21% of them thinking they could achieve it by age 24. Many would think that’s youthful optimism talking, and they have every right to be optimistic with all the new schemes released recently to help first time buyers take their first step on the property ladder.
With options available such as the Help to Buy ISA with a 25% government top up, the Help to Buy scheme allowing you to buy a new build property with a deposit as low as 5%, or the recent Rental Exchange scheme launched by Credit Ladder and Experian, it’s no wonder so many of today’s youth feel optimistic about investing in their first property.
Better get saving!
Unless you are lucky enough to have your mortgage deposit funded by the bank of mum and dad, and according to a recent article in the Guardian 25% of mortgages will be this year, you are going to need a strong plan to save as much money as you possibly can.
Having a good credit history is vital, you can boost your credit score by showing a lender you have a good relationship with your bank by paying your bills on time, by direct debit from a current account. Current accounts often come with better interest rates than saving accounts these days and you can really maximise their benefits if you are a savvy saver.
Help to Buy ISAs not only come with an interest rate from your bank, but also a top up of 25% by the government when you want to take out the money and put a deposit down on a property. You can receive a maximum of £3,000 of government top ups, and you must save a minimum of £1,600 before you qualify, at which point you instantly qualify for a £400 top up. This is a must for anyone looking to buy their first home.
Create a positive credit history
If you’re already a private renter, you can now take advantage of a new scheme called Rental Exchange. In short, you pay your rent to a third party called Credit Ladder, they transfer the money to your landlord the same day and then report the payment to Experian. It’s a great way to show lenders you’re a responsible payer and helps to create a positive credit history.
If you’re still living with parents, ask them to put one of the utility bills in your name, again, this shows you’re a responsible payer, but, I must stress, only if you pay on time. That’s why direct debit is the best way to pay. It takes away the danger of missing a payment by mistake.
Once you start to build a positive history, your credit rating will start to increase. Check out the guides below on how to improve your credit history, boosting your credit score, and the advantages of the Rental Exchange scheme.
Are you taking advantage of all the schemes available to you?