Factors for First Time London Buyers to Consider

Factors for first time London buyers to consider

If you’re buying in the UK’s capital, you can look forward to living in one of the most dynamic, exciting cities on the planet. But it’s this very uniqueness which makes purchasing your first residential property in London different to buying anywhere else, and means there are some specific things to take into account, and challenges which don’t apply when buying outside the city.

Sure, some things remain the same. As when buying anywhere else, you’ll have to consider factors such as budget and affordability (which can be more of an issue here, where average prices are significantly higher than elsewhere; London consistently ranks as the UK’s most expensive city). So get pre-approved for a mortgage early, and don’t underestimate upfront buying costs.

According to lender Halifax, the average first-time buyer paid £511,514 for a house in London last year, putting down an average deposit of £124,688. In comparison, the average first time buyer house price elsewhere in the UK was £311,034, with an average £61,090 deposit. So, clearly, you’ll have to think carefully about how you’re going to find that money, whether from savings, an inheritance, family support or anything else.

Here are some other factors to take into account as a first-time buyer in the capital:

• Know your leasehold and freehold

The majority of London properties are either freehold or leasehold, and there’s a high proportion of the latter across the city. Freeholders own both the structure and the ground on which it stands. Meanwhile, leaseholders (typically apartments) usually pay ground rent and a service charge to the freeholder who owns the land on which their building stands. See our blog giving more detail on this.

• Work with an agent who understands the London property market

An experienced agent who knows London and its property sector and its particular characteristics well, not to mention having in-depth local knowledge of the city’s various districts, will help any first-time buyer to make the decision that’s in their best interests, thanks to their professional expertise.

• Think long term

Buying for the first time in London is a huge investment. Will you still want to be in the property three, four or five years from now? What are your plans for the future? Are you likely to be changing jobs, for example, or will you probably need more room for a family you hope to expand? It’s also important to appreciate that, once you leave London, it becomes disproportionately harder to return, given local property prices.

• Researching different neighbourhoods

You’ll also have to consider area, proximity to work, transport links and local schools if that applies to your household. So, as you would anywhere else, research the various neighbourhoods carefully and in detail. You’ll need to love where you live!

Take the time to see what would best suit your own situation as a first-time buyer in London. Think about how far out you are prepared to be, and be receptive to considering new areas, even those you may not be particularly familiar with; as a first-timer, you don’t want to become overly fixated on one district. Homes near public transport such as Tube stations will have a higher resale value.

Check out popular up-and-coming parts of town on the fringes of more upmarket areas; you may get more for your money here.

Above all, be realistic. No part of London is likely to be 100% perfect; it’s a balancing act.

• Don’t discount a maisonette

London has a higher-than-average number of this property type, along with more flats and apartments. Maisonettes have their own entrances and no communal areas, reflected in the service charge since you don’t have to pay to insure these. So long-term costs could be lower, making these properties attractive to first-timers in particular.

Be a first-time London buyer with McGlashan Property Services

Founded in 1988, we at family-run McGlashan Property Services specialise in the prime central London market. And we have extensive experience of a market which is changing all the time.

Look through our current properties for sale in London and get in touch to learn more.