Solicitors for First-Time Buyers

A conveyancing solicitor can advise on all contractual matters related to the purchase of a property, and help see the sale process through to completion. Various local searches on the property, including with the Land Registry, will need to be carried out, and may be a requirement for a first-time buyer’s mortgage to be approved (a survey may also be required for the same purpose).

First-time buyers benefit from an exemption from stamp duty land tax (SDLT) if the purchase price is under £300,000 and it will be their main residential property. A first-time buyer may also be interested in and eligible for one of the Government’s Help to Buy schemes (see below), and this is another area that a specialist conveyancing solicitor will be able to advise on.

New: The temporary stamp duty holiday was due to end on June 31st, however, the Chancellor announced in this year’s Budget that it will continue to operate at a reduced rate until 1st October. From 1st July to 30th September, no stamp duty is payable on the first £250,000 of property sales in England and Northern Ireland. From 1st October, rates will return to normal with stamp duty payable on the value of residential properties over £125,000.

Arranging a mortgage is another prime concern for the majority of first-time buyers, and reliable legal advice can help a first-time buyer choose the right type of mortgage for them, and provide the information necessary for the application to be approved as swiftly and seamlessly as possible. A solicitor will also be able to advise on the different ownership models, including shared ownership, and tenancy arrangements available to first-time buyers, and how the financial side of things can best be organized to protect the various parties. This can also be important when a third-party such as a parent is making a financial contribution to the purchase and wishes to protect their investment.

The government offers a number of Help to Buy schemes to assist first-time buyers in Liverpool and the rest of the county with the purchase of their first home, including Help to Buy equity loans and Help to Buy ISAs. A Help to Buy equity loan means that a buyer will only need to find a 5% cash deposit on the price of a new-build home valued up to £600,000, with the government lending 20% of the purchase price, and the remaining 75% covered by the buyer’s mortgage. The equity loan is interest-free for the first five years, and must be repaid when the property is sold or the mortgage is paid off. In the meantime, the property must not be sublet, prohibiting buy-to-let landlords from exploiting the scheme.

First-time buyers looking to save up money for a mortgage deposit can also benefit from the government’s Help to Buy ISA scheme. The Help to Buy ISA is a savings account into which a prospective first-time buyer can deposit funds that the government will then top up by 25%. The maximum that the government will contribute to the account is £3,000, for which the buyer will need to save £12,000. Help to Buy ISAs are available to each individual first-time buyer, meaning that a couple buying their first home together could save up to £6,000 on the purchase price. Get in touch with our solicitors advising Liverpool first-time buyers to find out more about the various government Help to Buy schemes that first-time buyers can benefit from to help them take their first step on the property ladder.

The entire conveyancing process up to completion will take 8-12 weeks in normal circumstances. Using a local Liverpool based conveyancing solicitor can help speed matters up due to the latter’s knowledge of the local area and experience with similar transactions on behalf of first-time buyers. Our firm offers a transparent fixed fee structure for buying a property in Liverpool and Merseyside at competitive rates, and with no hidden costs. Get in touch with Louise Nelson and her team for a no obligation quotation today.

According to recent research by mortgage provider Santander, the Covid pandemic has hit the personal finances of first-time buyers harder than other types of property buyers. While 31% of all buyers stated that the series of lockdowns had enabled them to save more money for a deposit, only 17% of first-time buyers said the same.

Despite limited spending opportunities during the pandemic and its related restrictions, unemployment and reduced incomes (despite the furlough scheme), rising house prices and the cost of renting appear to have impacted younger property buyers to a greater extent than other buyers. According to Tracie Pearce at Santander, ‘Many younger people looking to take their first step on the property ladder have seen their earnings and job prospects hit hard, impacting their dreams of home ownership.’

Significantly, 52% of first-time buyers highlighted raising a deposit as the main barrier to buying a home in 2021, up from 30% in 2019. House prices have reached record highs in recent months (rising 10% in the year to May), as buyers have taken advantage of the stamp duty holiday and sought larger properties more suited to working from home. However, this has mainly been buyers moving homes and buy-to-let landlords rather than first-time buyers. A third (33%) of first-time buyers also stated that finding an affordable property in their desired area was a barrier to home ownership, three times more than said the same in 2019.

The government’s new mortgage guarantee scheme (launched in April 2021) should improve mortgage options for first-time buyers, 30% of whom said borrowing a sufficient amount was a barrier to buying in 2021. Santander is among a number of major lenders participating in the 5% deposit mortgage guarantee scheme, which is exactly the type of lending that struggling young adults and first-time buyers tend to favour.