Where to buy in London: First time buyers

Where to buy in London: First time buyers

The post-Brexit slowdown in London’s property market is creating an unexpected benefit for first-time buyers, says the Telegraph.

Until this year, Help to Buy, the Government’s flagship loan scheme to help first timers on to the housing ladder, made its biggest impact outside the capital, where an astonishing one in three new-build homes were being sold to people making use of it.

Spring Budget 2017: A Property Wish List

In London, however, only one in 10 new-build properties was bought under the scheme. This was partly because so many new builds in London cost more than £600,000 — the scheme’s upper price limit. But it was also because, until recently, developers found it easy selling flats to rich overseas buyers, cash-rich investors and affluent UK buyers.

These buyers had little need for Help to Buy. Indeed, some seemed to believe that involvement with a government subsidy scheme might tarnish the appeal of high-end developments.

Now times are tougher and as a result an unprecedented number of new schemes in some great locations are going on sale under Help to Buy London, a scheme that allows first-timers to take a 40 per cent equity loan rather than the 20 per cent maximum allowed previously. This enables Londoners with relatively minimal savings to buy with a deposit of just five per cent.

Martin Fillery, director at estate agents Currell and an expert on affordable housing, believes the Government is putting pressure on developers to offer Help to Buy London more widely as it tries to increase the amount of affordable housing in the capital.

“If they have seen any sort of slow-down in their sales rates it is a great way to open things up to a different audience.”

With more homes to choose from, buyers interested in taking advantage of the scheme can opt for already-gentrified areas — or those with great potential to follow suit.

The article cites Peckham, Acton, Mile End, West Ham and Bermondsey as the top areas for first time buyers.

Meanwhile, Showhouse reveals that just one in five of London’s new homes are being delivered on smaller developments.

Small and medium sized developments (SMDs) account for two in three new build schemes in London’s pipeline, but will only provide one in five of the properties, according to research from Kinleigh Folkard & Hayward (KFH).

The research shows there is currently a total of 1,031 private new build developments (all more than 20 properties per development) either awaiting planning permission, with planning consent awaiting construction, or under construction. These schemes will provide a total of 214,875 properties – the equivalent of 17 years of housing delivery in London (based on the average number of private homes completed per year in London over the last five years).

However, the analysis shows that while SMDs account for the majority of schemes in the planning pipeline (66%), with 41,878 individual properties between them they will only provide a fraction of the overall number of properties in London’s pipeline (19%).

London Development Hotspots revealed

John East, Director of Land and New Homes at KFH, said, “The Government’s Housing White Paper makes clear that small and medium sized developments are vital for London to meet its housing need. Our analysis proves that more has to be done to support developers at the smaller end of the scale. Making more land available for these developments and accelerating the construction of sites that already have planning permission is a start, but securing consent will remain a challenge where there are local sensitivities.”

While the overall picture for London shows SMDs providing just a fifth of units, the picture across the boroughs shows that five boroughs have SMDs providing the majority of units in the local pipeline.

Self-certified Sophisticated Investor

Please read

I declare that I am a self-certified sophisticated investor for the purposes of the restriction on promotion of non-mainstream pooled investments. I understand that this means:

I am a self-certified sophisticated investor because at least one of the following applies:

I accept that the investments to which the promotions will relate may expose me to a significant risk of losing all of the money or other property invested. I am aware that it is open to me seek advice from someone who specialises in advising on non-mainstream pooled investments.

High Net Worth Investor

Please read

I make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified high net worth investors and I declare that I qualify as such because at least one of the following applies to me:

STAY AHEAD OF THE MARKET

Sign up for first access to new developments and exclusive property investment opportunities.

We send limited and targeted emails on new launches and exclusive deals which best fit your areas. We are trusted by over 30,000 active buyers as their source for new stock.

  • New property developments
  • Professional market reports
  • Property deal alerts
  • Development updates
Manchester property investment

FIRST FOR NEWS AND KNOWLEDGE.

Receive trending news straight to your inbox and stay up to date on all of the property market trends and advice.

Established since 2005 we are a leading voice of authority and commentary on the UK property market. Our news is trusted by Apple News & Google News.

  • UK housing market
  • Mortgage & money
  • Buy-to-let landlords
  • Guides & advice

Talk to us

Speak to our UK property experts today:

 

+44 (0) 333 123 0320

Open from 9am-6pm GMT

 

+852 6699 9008

Open from 9am-6pm HKT