Poole Townsend says that despite low interest rates and affordable housing schemes aimed at making it easier for the first home owners to get onto the property ladder, they remain vulnerable and need independent advice.
Susan Pyne, Partner, Conveyancing Expert says: “First time buyers are most in need of independent advice. They are potentially vulnerable to the greatest risk of suffering negative equity. A significant number of repossessions take place against first time buyers who often do not fully anticipate the nature and significance of the responsibilities they are taking on.
“Many first time buyers need very specialist advice. For example, increasingly they receive financial help to buy from relatives and so there may be third party interests to protect.
“Many couples who are first time buyers, especially those who are not married, need to record their respective interests in the property. Failure to do this can result in disputes, and even court proceedings, at a later date.
"Having never been through the process they may need a more detailed explanation of the way the transaction works and the nature of the obligations they are assuming.”
The warning from Poole Townsend comes as affordable housing schemes, such as the Government’s FirstBuy initiative, and shared ownership schemes grow in popularity. Recent figures from Halifax show that such schemes now account for 13 per cent of private and housing association sales.
FirstBuy offers an equity loan of up to 20 per cent to first time buyers, while shared ownership schemes allow first time buyers the chance to part buy and part rent the property, increasing their share in the home through rental payments.
Angela Cornthwaite, Head of Property, adds: “Purchasing is still an affordable option in Furness and the South Lakes for first time buyers. However, it is recommended that first time buyers should consult their solicitor and financial adviser early on before deciding what their options are”.
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