What are the first time buyer benefits?

 

Buying your 1st home can feel like a daunting task, after all you haven't been through the process before so you don’t know what to expect. When you look at the challenge ahead a as whole it can seem like a mammoth task. But it shouldn’t. Today there are many incentives, schemes and benefits available to 1st time buyers to help you buy your 1st home, but to also make that process as easy and stress free as possible. 

 

Saving for the deposit on your 1st home got that little bit easier with the Lifetime ISA. The LISA is a savings scheme backed by the government in which you get a 25% bonus on anything you save up to £4,000 per year turning £4,000 into £5,000 per year. If you are buying with a partner they can also use a LISA which double the power of your savings, turning each £8,000 you save between per year into £10,000 as if by magic. 

 

Any property purchase over £250,000 in the UK is subject to stamp duty land tax, the amount you pay will depend on the band the purchase price falls into. But as a 1st time buyer the allowance for your 1st purchase is £425,000 which means you can buy a property for up to £425,000 and not pay a penny in stamp duty! 

 

At the time of writing this (2024) many high street lenders are making a big push for 1st time buyer business and as a result they are offering mortgage products with a preferential interest rate to encourage you to become a customer of theirs. The interest rate you get on your mortgage is one of the main drivers of the overall cost of your mortgage which can save you a lot of money. 

 

The same lenders offering better interest rates for 1st time buyers also offer cashback as an incentive to choose them too. The cashback is paid to you on completion which is aimed at helping you pay for your solicitor, your mortgage adviser or general moving costs to make buying your 1st home that little bit easier. 

 

Being a 1st time buyer means you not dependant on selling your current house to release a deposit to buy the house you are now buying. Being a 1st time buyer means you are bottom of the chain which can either create no chain at all (depending on the circumstances of the people you are buying from) or shortening the chain all together. This should speed up the time it takes to complete your purchase meaning you could be in your new home much quicker. 

 

A shorter chain or no chain at all is an attractive proposition to a seller because they know you aren’t selling a house which may have its complications or delays. If you make an offer against another buyer who needs to sell their home in order to complete the transaction, then you pose less of a risk when it comes to completing the transaction so the seller will likely choose you over another buyer type to increase their chances of a quick and successful sale. 

 

As you can see there are many benefits to being a 1st time buyer, so remember this when you start looking at your 1st property. There are many schemes and benefits available to help you on your journey and many sellers out there who would love to sell their property to you!