Turns out there is a lot of confusion when it comes to first time buyers buying a home with regard to costs and responsibilities. However, is this only to be expected when there is no universal guide to buying a property?
Buying a house can be a confusing process and home move comparison website reallymoving.com found out just how confusing it was for first time buyers in a recent survey. Earlier this year in February the site decided to survey 500 people covering a variety of topics related to first time buying; they found that many youngsters were unaware of certain costs and had a fundamental misunderstanding of many of the terms used in the house buying process.
60% of first time buyers believe that an estate agent or surveyor carry out legal searches with over a third thinking someone else will pay for the survey to be done on a property they’re interested in buying. Suggestions for who should pay for a survey included the seller, the buyer and seller together or the mortgage company. What seemed to be the biggest issue for first time buyers was identifying who was responsible for what in the buying process.
When asked who was responsible for issues relating to the environment, water/drainage and repair liability only 33% managed to answer correctly by identifying the conveyancer as the professional responsible. First time buyers lack vast amounts of knowledge in a decision process that will be one of the most important things they do in their life.
More areas that seemed to present gaps in knowledge for first time buyers were stamp duty tax and solicitors’ fees. Despite the Chancellor scrapping stamp duty tax for the majority of first time buyers, this would not have seemed to matter as almost a quarter thought the seller paid the duty. Whilst this is an added cost that might appear as a negative to those who didn’t know, some good news is that solicitors’ fees are probably lower than they think. Many of those questioned thought solicitors’ fees were double than what they actually were.
First time buyers are under-prepared and underfunded for the house-buying process. The problem is that they just don’t know what a lot of the process entails. 37% believed ‘exchange’ meant the day they get the keys and move in. Terms need to be explained and reiterated to those young people who find themselves caught in this position.
First time buyer activity is on the up for now but let’s hope the majority are prepared for what comes their way.