What can you afford as a first time buyer?

22 Jul What can you afford as a first time buyer?

Buying your first property is the most exciting and most terrifying thing you can do. All the jargon that is associated with getting on the property ladder can be daunting, but the thing that will prove most challenging to comprehend is the cost of it all.

As one of the leading estate agents in Tunbridge Wells and the surrounding areas we are somewhat desensitised to the kinds of figures which are associated with property transactions.

The Long Game

So if you are a first time buyer looking at getting on the ladder, what can you afford? The main thing to get straight in your mind is that this is a long term financial commitment so you will need to have a think about what savings you currently have and what your current salary is. Essentially these factors will dictate how much you will be able to borrow from a bank.

There are a number of mortgage calculators there which will give you a very rough guide as to what you can afford when it comes to buying your first home. While they’re great to give you an indication of the kind of budget you might be able to afford, they are only meant as a guide and not gospel.

Rightmove’s mortgage calculator can arm you with some good information to start your property search.

If you are buying by yourself and have an annual gross income of £30,000 and a deposit of £15,000, you might be offered a mortgage of somewhere between £96,000 to £135,000. This would equate to monthly repayments of around £510 to £710 per month – based on an annual rate of 3.90% over 25 years – and would mean you could afford a property in the range of £111,000 to £150,000.RightMove


Lenders will usually require 5% of the property value as a deposit – the higher the percentage of the deposit the better the mortgage rate. One of the key factors in getting on to the property ladder is the ability to save a large sum of money. A large deposit can take the pressure off of your monthly expenditure on mortgage payments.

If you are purchasing a property in England, Wales or Northern you will also need to be fully aware of your Stamp Duty obligations. While this tax was scrapped for most first time buyers in November 2017, the new rules and criteria will need to be met in order to qualify for exemption. You can find more information about this on the Money Advice Service website.

Miscellaneous Costs

Much of the expense of buying a property is down to the value of the property and the cost of gaining the mortgage – these include paying for solicitor’s conveyancy fees, surveys and searches. You will also be required by your lender to purchase buildings insurance to cover the building itself, as well as life insurance and income protection to safeguard the bank’s risk.

You will also have a number of other costs associated with actually moving. While these costs may seem nominal compared to the deposit and mortgage payments they quickly add up so it is important not to overstretch yourself and set your budgets sensibly.

Get in Touch

If you are a first time buyer and would like to speak to a member of our expert staff, please feel free to get in touch. We are always happy to guide you through your property options. You can call us on 01892 530109 or email us. You can also follow us on Facebook, Twitter and LinkedIn.

image: fizkes


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