Our Tips for First Time Buyers in Northampton
28th September 2020

Northampton is a great place for young people looking to buy their first home. With plenty of amenities available, a choice of rural or urban living, as well as a variety of affordable homes, there’s something for everyone. It’s a prime spot for commuting to the big city, and a great place to raise a family. 

That being said, buying your first home can be a stressful experience. Jackson Grundy will do everything they can to make the process as smooth as possible for you, and there are things you can do yourself that will ensure you put your best foot forward throughout your buying journey. Here’s just some of the things that all first time buyers should be aware of.

Understand Your Deposit

As a first time buyer, saving for your deposit will likely be the biggest thing you’ve had to save for in your life so far. The amount of money you will need to save for a deposit will depend on several factors such as:

  • The price of the property 
  • How much you earn

  • How much you will need (or want) to borrow

The minimum amount you will currently need for a deposit is  10% of the total value of the property. However, because lenders will be lending you the other 90% - and thus taking a larger risk - interest rates will be much higher on 10% deposits. 

In general, the higher percentage you put forward as a deposit, the better interest rates lenders are willing to give. At 15%, 20%, and 25%, interest rates are more competitive. 

Get to Grips With Available Schemes 

As a first time buyer, there are a variety of schemes available that offer you financial support during your purchase. The best one for you will depend on your financial situation at the time of purchase, as well as your short, medium, and long-term goals. Take a look at some of the most popular schemes below.

Help To Buy

Perhaps the most popular government scheme for first time buyers in Northampton, this scheme allows you to borrow up to 20% of the price of a property in the form of an equity loan, interest free for five years. To qualify for the scheme, you must take out a deposit of at least 5%, and be purchasing a new build home. You will not be able to apply for this scheme if the property you are purchasing is worth more than £600,000.

Right To Buy

If you are renting a property from the council, you may be able to purchase the property from them for a discounted price. The size of the discount will depend on where the property is located, as well as its size and type. 

Under normal circumstances, you will need to have been renting from the council (or another public sector) for at least three years to qualify for any discount related to Right To Buy. You don’t necessarily need to have been renting for three consecutive years - you may have rented privately for a couple of years in between renting publicly, for example.

If you don’t qualify for the Right to Buy Scheme, you may qualify for Right to Acquire. This scheme is fairly similar, but the discount will be smaller.

Shared Ownership

If you are eligible for this scheme you may be able to purchase a portion of a property from the local authority or housing association. You will be required to take out a mortgage on your share, and then pay rent on the portion you do not own. As time goes on, you can increase your share in the property, and in some cases eventually achieve sole ownership if you wish.

Case-Specific Schemes

There are other schemes available for certain groups of individuals, such as the disabled, the elderly, and those living in London. Similarly, those living in Scotland, Wales, and Northern Ireland will have other restrictions and options available to them.

Understand the Extra Costs

When saving up for your first home, it can be easy to just focus on the deposit. There are, however, a lot of other outgoings relating to your first home, especially at the time of buying. Other things you may need to consider include:

  • Mortgage advice
  • Conveyancing fees - a conveyancer is a legal representative who will ensure the property transaction is lawful.

  • Lender’s fees - you may need to pay your lender for some administration relating to your mortgage

  • Furnishings - you may need to purchase new furniture and utensils for your home, such as a bed, washing machine, TV, and so on.

  • Transport and removal costs - you may need to pay for somebody to help transport your belongings to your new home

  • Utilities - remember that in addition to your mortgage, you will need to pay for utilities such as gas, water, electricity, and internet.

Choose Jackson Grundy - Northampton’s No.1 Estate Agents 

With over ten offices located throughout the Northampton area, Jackson Grundy are the perfect choice for any first-time buyer looking for property in the area. Our friendly team fully understands the challenges and anxieties that first-time buyers might face, and we’re proud to see we’ve helped thousands of people transition smoothly into their first home.

You can browse through available properties here, and if you’d like to get in touch with us, please give your local branch a call.