Buying Advice

Should you buy?

If house price mania had a World Cup, Britain would lift the trophy. House prices have steadily been on the up for the last couple of years, adding more pressure to anyone trying to buy. Yet buyers need to pause and ask what, when and whether to buy.

Buyers should concentrate on whether buying is affordable and the right decision in the long-term, rather than panic over house prices or cave into the UK's 'must-own, must-own' mentality.

Few people accurately predicted the end of the house-price boom in 2007 and no-one really knows what is going to happen to house prices over the next few years. It is better to concentrate on bigger-picture financial security than risk financial ruin in a desperate attempt to get on the housing ladder.

Free mortgage deposit calculator

A mortgage is most people's biggest single outlay, and small differences in how much you borrow can have a massive effect.

Our Mortgage Deposit Calculator asks questions to determine when you'll have the dough for a decent deposit. Then see the Top Savings Accounts guide to maximise the interest.

As for deposit size, government schemes such as Help to Buy have helped increase the choice of mortgages for people with 5% to put down - but borrowers pay a premium at this level. Deals become more competitive at 10% or 15%, and for the really decent rates you need 25%.

First-time buyers can get a free £1,000/yr to help buy a property

If you’re a first-time buyer aged 18 to 39, you could get up to £32,000 from the Government by opening a new Lifetime ISA, which launched in April 2017.

You can save up to £4,000 a year into the LISA either as a lump sum or by putting in cash when you can. Then the state will add a 25% bonus on top if you use it towards your first home (or retirement). So if you save the full £4,000 you'll have £5,000. And that's before interest or growth.

The maximum that the Government will contribute is £32,000, meaning you'd have a total of £160,000 including the bonus to put towards your first home. Though bear in mind it would take 32 years to reach this level.

You need to have had the LISA open for at least 12 months to get the bonus cash for your first home. If you need to buy within a year of opening one, or you’re over 40, then use a Help to Buy ISA instead.

For full details, and a comparison of the LISA and Help to Buy ISA, see our Lifetime ISA guide.