According to City AM, London’s first free daily business newspaper, the average age of the ‘first time home buyer’ in the UK currently stands at 31 – in contrast to statistics in 1995 which placed first time buyers at just 28. Further, whilst in 1995 the average first home cost £65,000, in 2015 the average cost of a first time home is now stands at a staggering 196,000 with prices expected to rise a further 25% over the next five years. Consequently, City AM, claims few buyers, even in their early 30s, are able to secure that first time home without most often substantial financial support from family and friends.
Fortunately, young people, couples and families do have options, it is just a matter of discovering them. Hence, here’s three viable means of getting on the property ladder with little or no deposit:

1. Buy at Auction

Daytime TV shows such as the BBC’s Homes Under the Hammer have helped to popularise the idea of and incentivise many to consider purchasing a home at auction. The money an individual or couple can save by purchasing at auction can be in the tens to hundreds of thousands in some instances.
On the flipside, often homes sold at auction require (sometimes extensive) renovation. What is more, inexperienced property auction attendees can find that that bargain purchases can turn out to be a financial nightmare when rising damp, structural problems and the dreaded Japanese knotweed are later discovered. Hence, and as Homes Under the Hammer presenters always stress, it is imperative to always pre-read the legal packs provided ahead of property auctions, to visit any property that interests you and to budget extremely carefully.
For more information, the BBC website has published a very insightful and informative ‘Beginner’s Guide to Buying at Auction’.

2. Guarantor Mortgages

An alternative option to having to rely upon parents (as many do) to contribute financially towards that often costly deposit amount in order to purchase a first time home is to instead consider the option of a guarantor mortgage.
A guarantor mortgage can increase the chances of having a mortgage application accepted because it provides lenders more assurance and so decreases the risk associated with lending. Further, a guarantor mortgage provides those unwilling to ask parents, relatives or friends for financial assistance but equally struggling to secure a mortgage without support, a viable means of purchasing that first time home.
To learn more about guarantor mortgages or seek advice on whether a guarantor mortgage might work for you and your situation before approaching a potential guarantor, you might benefit from first seeking the advice of a professional mortgage broker, such as ourselves at Search Mortgage Solutions.

3. Government Schemes

If renovating an auction property or asking parents to be guarantors is simply out of the question, that first time home still might not be. An alternative is to look into any Government schemes available to first time buyers. Specifically, ‘Help to Buy’ schemes have been especially formulated to enable anyone with only a small deposit amount saved who is hoping to buy a property up to the value of £600,000.
‘Help to Buy’ schemes work most commonly through the government agreeing to supplement a mortgage borrower’s deposit so that the borrower can expect to stump up as little as 5% of a property’s value as a deposit. The remainder of the deposit, paid initially by the Government, is provided by means of a loan which most often remains interest free for the first five years, affording would-be home owners to both afford to get onto the property ladder and as well the time to repay the loan before interest is incurred.
Whilst this is the most common way in which a ‘Help to Buy’ scheme operates, it is not the only way. To learn more and what other support the Government can provide to first time buyers, visit the Own Your Home UK Government website.