Getting on the first rung of the property ladder can be a Herculean task for first time buyers. As we know, the Chancellor of the Exchequer, Rishi Sunak, has extended the Stamp Duty Holiday for Leicester homes up to £500,000 from 31st March 2021 to the 30th June 2021; and to make sure the UK avoids the looming economic cliff edge, from 1st July 2021, the Stamp Duty Holiday will be applied just to properties up to £250,000 until the end of 30th September 2021 returning to the pre-pandemic levels as of the 1st October 2021
The government has confirmed that 95% mortgages will be available from April, on the purchase of properties up to the value of £600,000. The lifeline to Leicester professionals attempting to get on the property ladder is that a home can now be purchased with just a 5% deposit! For those struggling to save deposits in the present climate this has come as a huge aid. Not only that but with no decision yet made on capital gains tax (much to the delight of local Landlords and property investors) AND the furlough scheme being extended until the end of September for those hardest hit by the pandemic, it’s fair to say the present situation has thrown some serious curve balls of late.
If you’re looking at taking advantage of the latest on offer from the Chancellor and getting on the first rung of the ladder here’s some basic tips on saving for that illusive deposit:
- Firstly reduce your bills:
Switch to cheaper energy tariffs, look for better deals on mobile phone and broadband packages and check to see if you qualify for a 25% council tax reduction. Check it out here
- Spending Levels:
Cut down on every day spending with small changes to your everyday outgoings. Check bank statements monitor spending habits (check out apps like Monzo and Starling). Did you realise your daily cup of coffee could be costing you £600 a year, or that you’ve been spending £150 on clothes every month? Remember EVERYTHING adds up.
- Make money pay!
If you do spend on a regular basis why not make it work for you and get a cashback card to earn back on your shopping? Also consider transferring money every month to a credit card and using it like a debit card for your monthly spends. This will help you improve your credit rating and prevent you (with little monitoring) spending money you don’t have.
- Saving Apps:
There are some great apps out there that will direct spare cash to a savings account, and help you build u up your funds for a deposit. Apps like such as Monzo and Oval, can round up your spending to the nearest pound and deposit the difference into a savings account. Apps like Chip, Plum and Cleo, will actually analyse your financial patterns and decide your affordable spending limits for you. Make sure that whatever cash you do save is transferred to a high interest account as ofcourse, these apps don’t pay interest on what you’re saving.
- Your living situation:
Assess your living situation and consider making that dramatic step of living with someone else to reduce your monthly outgoings. In most circumstances this can make a difference of up to 50% of your outgoings!
- Earning Extra:
Make some money on the side of your regular job and consider freelancing in your spare time, setting up an Etsy account or renting out games consoles you no longer use. Be aware that you may have to submit a self-assessment tax return and pay income tax on any extra money you have coming in.
