The average deposit for a first-time buyer in the capital currently stands at around £90,000. That's not an inconsiderable sum by any stretch of the imagination. If you want to buy a property in London, most buyers will need to have to budget. Here are our best tips for cutting costs and saving up to buy your very own property:
1. Assess how much you can afford to pay realistically
The average London salary is around £35,000. You may earn less, you may earn more. From your salary, deduct all your monthly expenses – things like rent, bills, mobile phone contract, insurance, travel costs and so on. See how much you have left to play with. It's likely you don't want to become a hermit. So, work out how much you can save each month realistically, while maintaining a reasonable work/life balance. Then you will have a real idea of what kind of deposit you can afford to pay and how long it will take you to save up for it.
2. Work out where to buy property in London
The number of renters and buyers in the big smoke is currently split 50-50. If you want to join the buyers' category, it is possible. You just need to figure out the best areas to buy property in London. Naturally, some boroughs are more expensive than others. Battersea and Brixton are both well-connected areas with excellent amenities and proximity to green spaces, and they continue to offer good value for property buyers. We know Battersea and Brixton well, and can assist you when searching for the right property in these areas.
3. Find out how much you can borrow
Mortgage lenders consider a range of factors when deciding how much you can borrow. This will include your income, credit rating, regular expenditure, and the size of your deposit. You can get a rough idea of how much you'll be able to borrow by using a mortgage calculator. The good thing is that rules around mortgages make sure you can only borrow what you can comfortably afford.
4. Factor in all costs/charges
There are other costs on top of your mortgage that you'll need to take into consideration when working out how much you can afford to pay for a property. This includes buildings insurance, for example. There are the estate agent's fees, stamp duty, solicitor's fees, surveyor's fees and the cost of actually moving. Don't forget to factor all this in.
5. Tighten your belt
Some people are naturally thrifty, others are not. But you might have to cut down on your spending if you want to save up to buy a property. This might mean cutting back on unnecessary expenses, as believe it or not, the little things can add up.
We know that budget planning isn't easy. But you need to be realistic and arm yourself with as much knowledge as possible about the costs involved in buying a property. For further advice, feel free to get in touch with one of our estate agents at Battersea or Brixton.