My middle son – one of three – and his fiancée have a great year ahead of them. Fingers crossed, they will move into their first-home in the coming weeks, a three-bedroom semi-detached house in Hertfordshire.
Once they have stamped their mark on it – a conservatory here, a new kitchen there – it will not be long before the wedding bells are ringing in Watford and the confetti falling like flakes of snow. Although I consider myself a rather phlegmatic individual, I must admit to a tiny tinge of emotion at the thought of it all.
At the age of 26, Mark will be the first of the three boys to get married. The reception has already been booked at the magnificent De Vere Latimer Estate in the rolling hills of the Chilterns in Buckinghamshire although Mark has yet to tell me the date (the Prestridges like their secrets). He did give me a guided tour with fiancée, Hollie, presumably to forewarn me about the expense of the occasion that I will (no doubt) be part-funding.
For the record, Latimer House, the hotel’s heart, is steeped in history and well worth a gander. Family wealth – the Cavendish clan – a key intelligence-gathering role in the First World War, and the site of an IRA bombing in 1974.
What I love about Mark and Hollie’s journey towards becoming first-time buyers is that they have done it primarily on their own. There has been no bank of Mum and Dad to help them with a home deposit. They have saved hard – admittedly made possible by both having good jobs – and they have made quite a few sacrifices along the way. They have also been extremely patient.
To begin with, they both lived with their respective parents. They then decided to rent a lovely one-bedroom flat on the outskirts of Watford. Independence at last.
But after a year, they realised two things. Firstly, they were compatible and could live together. Secondly, they were throwing money down the rental drain. Money they could be putting aside to build a deposit big enough to get them a mortgage for the kind of property they were interested in.
So, boldly, and with my wife’s full blessing (we are separated and live apart), they decided to forego their independence (albeit temporarily) and move into the Prestridge family home and save as much as they possibly could. It proved a winning strategy.
In fact, everyone seemed to enjoy themselves. Mark proved a master in the kitchen, Hollie got on with Susan (my wife) like a house on fire and feuds were few and far between, helped by the fact that they were able to escape to their eyrie on the top floor of the three-storey town house.
There has been no bank of Mum and Dad to help them with a deposit
On the financial front, they have opted for a two-year fixed-rate mortgage on the basis that when it comes to remortgaging in 2021, they will have built more equity in their home, enabling them to snap up an improved rate. Logical – and they did not even ask me for advice, using instead a trusty independent mortgage adviser.
Although Mark and Hollie have finally got their feet on the housing ladder, the market for first-time buyers remains challenging. This is evidenced by the fact that the average first-time buyer is now 30 and has a gross household income of £42,000.
But there are some encouraging signs. Although the number of first-time mortgages taken out last year will be slightly down on 2017, they remain substantially above the levels of the past decade.
While this government has got many things wrong on the personal finance front, I find it heartening it continues to help first-time buyers through various schemes. These include Help to Buy, which enables people to buy homes up to a value of £600,000 in England with just a 5% deposit (different rules apply in Northern Ireland, Scotland and Wales). The government provides an interest free loan (for five years) of up to 20% of the property’s value to make the numbers work.
There is also shared ownership, where you buy a share of the property (anything between 25% and 75%) and pay rent on the rest. Waiting in the wings is the Starter Homes scheme, which will enable first-time buyers to buy new-build homes at a 20% discount – up to a maximum home value of £450,000 in London and £250,000 elsewhere.
Also, it has reduced or removed the stamp duty burden for many first-time buyers,with purchases below £300,000 attracting no tax and ones between £300,000 and £500,000 only attracting 5% duty on a purchase price above £300,000.
Of course, it is still not a totally friendly first-time buyers’ market and the affordability hurdles for many aspiring homeowners remain too onerous to overcome.
But with perseverance, hard saving and support from loved ones (financial or, in our case, non-financial), you can get on the housing ladder.
JEFF PRESTRIDGE is the personal finance editor of The Mail on Sunday. He won the Contribution to Personal Finance Education category at the Santander Media Awards 2016. Email him at firstname.lastname@example.org.