My First Home Ltd.

Buying your first home can be a daunting process; anyone who has been through the process will tell you this. However, it need not be the case, once you have made the decision to buy your first home.

This page sets out to provide a guideline as to means of ways of understanding how the whole process works. In doing so, such will not be useful without an effort on your path. It should be noted the factors that affect your buying decisions are changing periodically which include the UK laws and regulations. In so doing, in the search for your first home check with reliable sources before you make an informed decision.

We at My First Home Limited will like to wish you a pleasant journey in the search for your new home. If your do have any questions or feedback please do not hesitate to contact us at info@myfirsthomeltd.com.

Why Buy My Home

This is all down to you as a potential first time buyer. There are many reasons that lead to the purchase of your first home, but once you have made the decision be sure we are there to help and support. It is worth mentioning that prior to the decision to buy it is worth getting into the habit of learning about the buying process and determining what will be your ideal first home.

Where Should I Buy

Typically you will find that this will be determined generally by

Proximity to friends and family
Proximity to your place of work

Where to buy is based on personal choice, which only you can determine. Please go through the various facets of information provided and this will serve as a guideline in the selection of your first home.

The Property Market

The residential property market has a shortage of housing which is estimated at 2-3 million homes. This shortage is rising by approximately 100,000 homes per annum with the average household size decreasing from 3.2 in the 1960s to the current average of 2.2. In addition, we have more single people living on their own compounded by investors seeking to profit on the shortage. Such amplification by the buy-to-let investors has been made possible since the 1988 Housing Act, removing the security of tenure and rent control for private tenants.

Subsequently, this has caused the Government to launch reviews into the current challenges faced by the housing market. Such include:

Dramatic market failure with over 130,000 new builds to cater for around 250,000 household formations per year.
The Barker report, looking into supply issues and what can be done to increase flexibility in the property market.
The Mile Report on the UK mortgage industry and what can be done to make it more long term.

Approximately 10 years ago there was an estimated 500,000 first time buyers and today we speak of just under half this amount.

This begs of the situation that the housing market has reached a level which currently needs to be addressed - The outcome - housing crises. In addition, critical personnel; nurses, teachers, police, firepersons are experiencing the same challenge as first time buyers. Such has created disillusionment amongst the first time buyers as they have technically been priced out of the market. All of such have social implications.

Affordable Housing

Based on the long tradition of the UK affordable social rented housing, the promotion of affordable housing has been included as a solution block, using the various approaches outlined below, under mainly the management of local councils and housing associations:

Affordable home ownership options including shared ownership (where a tenant rents part share in the property from a social landlord and owns the remainder)

Owner occupied affordable stock using the land ? use planning system to require that housing developers provide a proportion of lower cost housing with new developments.

Right to buy, where previously council owned properties can be purchased at a discount of up to 60%- 70% pending on the nature of the property.

Types of Homes

Old Homes
Modern Homes
Apartment (Flat)
Barn Conversion
Bed-sit
Bungalow
Cottage
Detached House
House boat
Maisonette
Mews House
Mobile Park home
Period Property
Semi Detached House
Studio
Terraced House
Townhouse

Property Prices

Kindly go to the following links and references were the UK residential house property prices are periodically changing, Useful Links

Researching the Market

Apart from the rich experience you will gain about property on this site, it is recommended that you diligently go through a series of channels some of which may not be available to you on this site. This can be outlined as follows:

Estate Agents
Internet
Newspapers
Magazines
Search Agencies
Property shows
Auctions
Private Sales
For sale boards

Home Information Pack

The idea of the Home Information Pack evolved over time, initially in expectation that they would reduce the practice of gazumping. However, the emphasis subsequently moved to the benefits of increased speed, transparency and consumer friendliness.

It is estimated that ?350 million is currently lost through house purchases that do not go ahead because of problems found by buyers during the house-buying process. The government expects that, by providing the purchaser with more initial information, fewer people will change their mind soon after, and that the time it takes for the buyer's conveyancer to carry out the legal work should also be reduced.

Originally the HIP was going to be required from June 1, 2007. However, just ten days before that date, Communities Secretary Ruth Kelly announced that they would be phased in from August 2007, and initially only for larger properties.

The pack must contain the following, which must be no more than three months old when the property is first marketed:

Index
Energy Performance Certificate
Sale Statement
Title documents for the property
Local Authority and drainage searches

If the property is leasehold, then the pack must also include the following:

Copy of the lease
Building insurance policy
Contact details for the landlord or management and any legal details
Regulations that apply
Recent service charge receipts and accounts

For a transitional period sellers can market their homes without the searches or leasehold documents as long as the pack contains evidence that they have been commissioned and will be included as soon as practicable but certainly within 28 days.

The pack may also contain some or all of these authorised documents:

Home Condition Report
Two sellers questionnaire forms called Home Use Form and Home Contents Form
legal summary
Other searches such as a mining search

Cost

The industry now expects the Home Information Pack (excluding the Home Condition Report) to cost between ?300 - ?600 for the vast majority of properties in England and Wales.

The Government point out, however, that most of the items in the pack already have to be provided during the sale process, so this is not all an additional cost. However the Council of Mortgage Lenders reported that their members were planning to insist on a separate valuation in addition to the Home Condition Report, while those purchasers requiring a structural survey would also have to pay extra.

For properties that have been on the market some time, it is likely that there will be additional costs incurred to bring the information in the HIP up to date.

Failure to provide a Home Information Pack or supplying an incomplete pack carries a fine of ?200.

Enforcement is to be carried out by local authority Trading Standards Departments, however they claim that this is inappropriate as they normally regulate businesses, and that it would cost them too much to enforce through the civil courts.

Mortgages

There are a wide range of mortgages available to you examples of which are outlined below. To get a full explanation of how each type works kindly go to our Glossary page.

Guarantor Mortgages
Self Certification Mortgages
Fixed Rate Mortgages
Variable Rate Mortgages
Tracker Mortgages
Repayment Mortgages
Discount Mortgages
Deposit free loans
Cash Back Mortgages
Standard Mortgages
Repayment Mortgages
Interest Only Mortgages
Endowment Mortgages
Investment linked or ISA Mortgages
Pension Linked Mortgages
Special Mortgages
Flexible Current Account Mortgages
Offset Mortgages
Self Build Mortgages
Buy to Let Mortgages
Foreign Currency Mortgages

Stamp Duty

Stamp Duty Land Tax when you buy property

Stamp duty land tax (SDLT) was a new tax in land transactions that was introduced by the Finance Act 2003. It largely replaced stamp duty with effect from 1 December 2003. SDLT is not a stamp duty, but a form of self-assessed transfer tax charged on "land transactions

You pay Stamp Duty Land Tax on property like houses, flats, other buildings and land. If the purchase price is ?125,000 or less you don't pay any Stamp Duty Land Tax at all. If it's more than ?125,000, you pay between one and four per cent of the whole purchase price, on a sliding scale, outlined as follows:

Residential property - purchase price	Rate of Stamp Duty Land Tax
up to ?125,000	0%
?125,001 - ?250,000	1%
?250,001 - ?500,000	3%
?500,001 or more	4%

Property in disadvantaged areas

If you're buying a property an area designated by the government as 'disadvantaged', you don't pay any Stamp Duty Land Tax if the purchase price is ?150,000 or less.

Useful Addresses & Websites

Go to useful links

Further Reading

Go to Bookshop, articles and whitepapers

The reference to any company, organisation, product or publication is for reference purposes only and does not constitute an endorsement or recommendation.

YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR LOAN SECURED ON IT.
Myfirsthomeltd.co.uk TAKES NO RESPONSIBILTY NOR PROVIDES ADVICE ON THE ACQUISITION OF A MORTGAGE AS THIS IS PROVIDED BY OUR PANEL OF PROFESSIONALS WITH WHOM YOU DEAL WITH DIRECTLY AND THEY ARE AUTHORISED BY THE FINANCIAL SERVICES AUTHORITY.
If you have any doubts you should contact an independent financial advisor.