How to Make Your Money Go Further When Buying Property

2345246tRecently, the Telegraph ran a fascinating article discussing the experiences of a young British couple who have struggled to make their mark on the London property market in the wake of the recent, exponential growth. Despite having a combined income of £50,000 and a huge deposit of £95,000, they have struggled to identify viable housing in the capital that is within their budget. This highlights the oppressive nature of real estate in the capital, as even couples with considerable financial resources are struggling to save a large enough deposit to meet spiralling prices.

How to Thrive and make the most of your Money in the Property Market

No example better embodies the fact that house price growth continues at a disproportionate rate to national earnings, and anyone hoping to buy a home particularly in places like London will need to plan their move in considerable detail. Here are a few tips to help you get the most from your money in the capital: 

Research the market to find more Alternative Homes in the Capital

Whenever we think of London real estate, we mistakenly categorise all properties in the capital as being luxurious and disproportionately expensive. While there is at least some truth to this, however, London is no different to other regions in that it is home to both affluent and more affordable regions like Battersea, for example, which is commonly referred to as Chelsea’s more affordable alternative and boasts excellent transport links. Properties in the East End and the North of London are also more affordable than those in prime central locations such as Kensington, so these may be areas to focus on during your search.

Remember that Timing is everything

As with any big ticket investment, buying a home relies heavily on timing your move to capitalise on market trends. This is particularly true in London, as while prices in the region have risen steadily (and at times explosively) during the last 18 months there have been periods of stagnation in this time. During the final financial quarter of 2015, for example, growth in prime regions such as Kensington and Chelsea dropped to a little over 1%, while the market is also expected to consolidate towards the end of this year. This means that timing your purchase for 2016 may help you to get the most from your investment.

Try to focus on the lower end of your mortgage offer

Some people loath to buy property at all in London, believing that large mortgages represent debt that should be avoided. This is a type of good debt, however, and the impact of having a mortgage is extremely positive when compared to the £178.2 billion of credit card and loan repayments owed by UK consumers. Instead of avoiding buying a home and renting instead, you should focus on securing a mortgage offer and aiming for the lower end of the London property market, targeting lower value regions and even properties sold through auction.

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