It can sometimes be difficult to get the ball rolling with your mortgage application, especially if you are a First Time Buyer. There are lots of different things to get ready before you apply for a mortgage in Birmingham, and one of the most important things that you need is a deposit.
First Time Buyer mortgage applications always vary when it comes to deposit amounts, purchase prices and loan-to-value percentages. As a Mortgage Broker in Birmingham, we recently carried out a First Time Buyer study and it was found that Birmingham, when compared to Coventry, had lower results for all of these variables, here is a closer look at the data:
House prices in Birmingham are typically cheaper when compared to somewhere like Coventry, in turn, this leads to a lower deposit contribution. From the results, it was found that the average deposit amount for a First Time Buyer in Birmingham is around £32,200, whereas in Coventry the average is £35,200.
Whilst many First Time Buyers manage to save up a portion of their own deposit, a common occurrence in the home buying world is for family members or friends to provide additional support by gifting part of the deposit for them.
Sometimes, a gifted deposit can end up pushing an applicant into a lower loan-to-value bracket which opens the door to more competitive products and lower interest rates.
As you can see from above, house prices in Birmingham are generally affordable for First Time Buyers across the board. When it comes to First Time Buyers the average purchase price is currently £181,000. This is around 12% more than the average First Time Buyer in Coventry which stands at £205,750.
Now we have covered the average purchase price and average deposit for First Time Buyers in Birmingham. We can now work out what the average loan to value is.
With lower loan-to-value percentage, usually comes more competitive rates. In Birmingham, the average LTV is 82%, which is lower than the Coventry average of 83%.
The infographic below shows how to work out your LTV percentage:
Birmingham has reasonable property prices, even when compared to Coventry. With gifted deposits becoming more and more popular and interests rates low, now could be the perfect time to take that step onto the property ladder as a First Time Buyer in Birmingham.
This data is taken from Mortgage Broker in Birmingham – Birminghammoneyman’s collected statistics on First Time Buyers living in the North West.