First-time consumers are paying almost eight per cent over the asking value to safe their first residence, in line with new information from property brokers Yopa who in contrast common asking costs to common bought costs for first-time purchaser properties.
The typical asking value for a first-time purchaser residence within the UK is £227,570, in line with Rightmove, whereas the UK Home Value Index exhibits the common value {that a} first-time purchaser residence truly sells for is £245,208 — 7.8 per cent increased on common than the unique asking value.
That is even though first-time consumers current an awesome prospect for distributors as they don’t have anything to promote and there’s no probability of a collapsing chain scuppering the sale. The figures counsel there’s a shortage of first-time purchaser properties in comparison with the remainder of the market — and loads of competitors.
“These findings spotlight the challenges first-time consumers are dealing with in immediately’s extremely aggressive housing market. On common, consumers are paying a further £17,638 to safe their first residence, which displays the robust demand for extra inexpensive houses and the stress inexperienced consumers might really feel to supply extra,” explains Jonathan Bone, Head of Mortgages at Higher.co.uk.
“This emphasises the crucial significance of monetary preparation and strategic planning for these trying to get on the actual property ladder.”
The place London first-time consumers are transferring to
In London, a first-time purchaser pays greater than double that of the nationwide common; the info discovered {that a} starter residence within the capital is available in at a median of £506,706.
By way of the place London first-time consumers are buying in 2024, Higher.co.uk had 85 first-time purchaser mortgage functions for Tower Hamlets and Hackney, with a median deposit of £70,500 and a median worth of 435,000; 77 functions for Westminster, Kensington and Chelsea, with a median deposit of £95,750 and a median property worth of £500,000; and 71 functions from first-time consumers in Southwark the place the median deposit was £72,643 and the median property worth £401,000.
The least well-liked areas of the capital for first-time consumers included Haringey, Newham and Barking.
The way to get a proposal accepted with out overpaying
1. Organise an Settlement In Precept
An settlement in precept is a doc from a mortgage lender confirming how a lot they’ll lend you, primarily based on monetary issues reminiscent of your wage and deposit.
“It could possibly strengthen your place as a first-time purchaser as a result of sellers usually tend to take your supply severely if in case you have this conditional approval in place… An AIP helps offer you a aggressive edge, particularly in a difficult property market the place sellers might obtain a number of presents,” says Bone.
Being a first-time purchaser comes with the massive benefit that you simply aren’t in a sequence. Which means that you usually tend to be versatile on alternate and completion dates.
If a vendor needs to promote shortly or hasn’t had an opportunity to search out their subsequent property, this flexibility is one thing they’ll admire and will provide the edge over different presents who’re in chains and constrained by timings out of their management.
3. Begin along with your greatest supply
First-time consumers typically suppose that they should put in a number of presents earlier than securing a property, however you would possibly find yourself paying extra in the long term – and even dropping out.
“Contemplate making your greatest and highest supply first, if you wish to keep away from a prolonged negotiation course of and cut back the danger of one other purchaser pipping you to the submit. That is one other efficient method of displaying the vendor you might be severe and financially ready, which can assist make your supply stand out. It additionally prevents the necessity for back-and-forth negotiations, which might generally result in dropping the property to a different purchaser,” says Bone.
4. Write a personalised cowl letter
Whereas shopping for a home can really feel very transactional, a private contact does assist. Alongside along with your supply, take into account writing a letter about who you might be and what you want concerning the property.
“Sending a personalised cowl letter can assist set you other than different consumers. Whereas the choice finally will depend on the vendor, it’s essential to do not forget that placing a property up on the market is a major occasion for individuals, because it might need numerous sentiment and recollections connected to it,” says Bone.
