The property market can be a challenging place to find value, but with the right knowledge and research, you can secure a great deal.
As of 1 September 2019, Metropolitan Police Constables can start their career on a salary between £20,800 and £24,177. So, if you’re beginning a career in the service and looking to buy a property at "in and around London" prices, you might find the situation a bit daunting, but it’s far from doom and gloom.
According to Zoopla*, the average house price in the capital stands at £509,047 with the average deposit required being £126,600. As a result, getting on to the housing ladder can be a struggle for many, especially those beginning their career. However , if you can be prepared to compromise on where you want to live and look at the benefits of places that little bit further away from central London, you might be surprised to see what you can buy.
Getting the money together
There’s help at hand for first-time buyers in the way of financial products.
Providing the value of the property you’re looking to buy is £450,000 or less, you could use a Lifetime ISA to help you save. With a Lifetime ISA you get a 25% bonus from the Government, which means you can get up to £1,000 per year extra towards a deposit on your first home. And if you’re buying with someone else who has a Lifetime ISA, you can combine your savings and bonuses. If you can both afford to save the maximum amount into your Lifetime ISA, it will open you up to far more options around where and what you can afford to buy.
There’s also the Help to Buy scheme to consider and you can find out more about the benefits of both and how they compare in our blog.
Whilst a property could be out of reach financially at the moment, don’t forget that your police salary is likely to increase , so try to put away a little more every year you move up a pay point.
Opportunities to work overtime may also arise often, helping you to earn and save more than you might imagine. That extra money you earn could significantly speed up the time it takes to save up a deposit, especially when buying somewhere is a priority.
Where can you get the most bang for your buck?
London's housing market is diverse, both in terms of the types of property available and the level of affordability for buyers.
One such area is Dagenham, where analysis by Which?** shows an average property sells for just over £300,000. Meanwhile, Bexley comes in second and Newham third on their list of cheapest places to buy in London - at approximately £341,000 and £365,000 respectively.
Prices are also markedly less expensive in many commuter towns outside the central London area. Places like Harlow, Basildon, Braintree and Stevenage all lie within a 40-minute commute by rail into central London, but house prices in these areas are typically much lower than in the heart of the city.
Choose carefully where you want to live and take into account the travel benefits you can access as a police officer. That way, finding somewhere with a quick commute in without spending a fortune on travel fares, even when you’re stationed in London, is very much achievable.
To find out where you can currently afford to buy, try the BBC House Price Calculator; this also has a feature for people looking to rent.
Solutions to help you get that mortgage
As previously mentioned, both the Help to Buy scheme and the Lifetime ISA can be powerful tools to help bolster the amount of money you have available for a deposit.
Options like shared ownership are helping more of London’s first-time buyers to gain a foothold on the housing ladder and can dramatically reduce the amount you need to save towards a deposit.
Shared ownership also gives you the option to buy an additional percentage ownership of your property at the market value further down the line, when you have more funds available, using a process known as 'staircasing'.
We know that getting on to the London property ladder is not always easy, but with the wide range of options and ways to save that are now available, your dream of owning your own home could be much closer than it seems.
If you'd like to find out more about saving for your first home, how much it could cost to make a range of value-adding improvements, or if you're simply looking for inspiration on ways to bring new life to your existing property, download our useful guide 'Home buying and renovation in London and beyond'.
* Zoopla article (March 2019)
** Which? analysis
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