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1: Is purchasing a property more financially attractive than continuing to rent?

Renting a property is certainly not a case of "throwing your money out the window", as it offers the most flexible and financially viable solution for many individuals who do not have/want a fixed, long-term residence. The demands of the world or work and the ability to move to greener pastures when the time suits mean that many individuals are not (yet) interested in setting their life down in stone.

However, research by Santander Mortgages has identified that "first-time buyers (FTB) would have significantly lower monthly outgoings if they bought a property rather than renting one." Looking specifically at the data for East Midlands, taking the average FTB house price of £161,682 - divided by the average monthly mortgage repayment (£577) to equal a 23-year repayment term - would provide a saving of £12,609.51 compared to renting.

2: Will purchasing a property secure a life-long family residence or does it offer the potential for a significant return on investment?

Buying a home these days is not seen merely as a life-long contract, the potential return on investment and moving up the property ladder can be achieved by renovating or buying-to-let. As shown by a handy Property Investment Calculator created by GoCompare, for renovations under £5,000, installing a new boiler and adding energy-saving improvements are two of the best ways to gain a profit if you are planning on selling.

This alternative option of buying to let houses for sale in Retford offers an equally profitable Investment Strategy. The market town is on the up, prices are affordable, and the rental market is buoyant – there is lots of money to be made, as long as you make the right decisions.

Nottingham looks set to outperform London over the next five years when it comes to house price increases. Research from Savills forecasts that while average UK house price growth is expected to slow to 14 per cent over the next five years, there will be marked differences between and within regions and the East Midlands will surge at double the rate of London.

3: Are house prices accessible?

While it is almost impossible to predict the low point of real estate price curve, it is possible to calculate if prices are over or undervalued at the time you want to buy; for example by comparing the current level of housing prices against Historical Data. As indicated by Zoomla in a recent report on House Price Growth, "Most regions of the UK saw a slowdown in the annual rate of growth in the last three months"... however... "other regions continued to enjoy solid gains between April and June, with annual house price inflation of more than 4% in the East Midlands, West Midlands and Wales, although in all cases this was a slowdown compared with the previous three months."

Defining your needs in the short and medium term and the budget you can spend on your first home or apartment purchase is an important step. What you must do is identify whether this is the right move for you and whether it's the right time to buy a home. Only you will know, and much depends on your own circumstances. Before you start the process of purchasing a property for sale in Retford, it is crucial to scrutinise your financial records, including comparing liquid assets to current liabilities to clarify if you are Financially Ready to buy.


The right interest rate..

When you choose a mortgage type, you’ll be faced with an array of further options for interest rates. Interest is the money you have to pay on top of the loan. So, as well as borrowing the sum required to help pay for your new home, you also have to take into account the rate you are paying to borrow the money.

For instance, you might want to take out a mortgage for £50,000. If you are getting the money with a 6% interest rate, you will be paying back more than a mortgage at a lower interest rate of say, 3% or 4%. Usually, if you put down a lower deposit, you will end up with a mortgage with a higher interest rate, so make sure you understand what you will be paying in total.

Interest rates go up as well as down, so be careful that when you work out what you can afford to repay you take into account the fact that interest rates could rise. Then, you will be required to pay more. You could be in big trouble if your salary isn’t enough to cover the mortgage. Before you sign on the dotted line, get advice from a trustworthy financial expert so you don’t overstretch yourself.

Interest rates can be worked out in different ways. Here are the main rates and what they mean:

Variable Rate

All this means is that the interest rate on your mortgage can vary and go up and down. So, the lender could ask you to pay more or less, depending on what is happening with the economy and financial markets. 

As indicated in a study, reported by the Buy Association and conducted by the Universities of Manchester and Nottingham, a major reason people don’t shop around is due to the confusing jargon used in the industry. The study estimates that more than half of homeowners with mortgages in the UK could save as much as £300 a month – a huge £3,600 a year – by switching to a different mortgage product You need to be prepared to pay more if the rates go up without crippling yourself and losing your home.

Fixed Rate

The rate is fixed for a certain period of time, normally for one to five years. This is a sensible approach because you can work out your budget in advance and you won’t be worrying what could happen if the rate goes up, as could happen with the variable rate.

If you can afford to go down this route, this is a safe approach. You will know how much you have to pay and it won’t alter for a set time.


Interest rates and payments
Take advantage of guides on lenders’ websites (if you can’t easily access the Internet, you can ask them to post you the guides). These list what you should expect to pay on an interest-only mortgage and repayment mortgage, along with interest rates.

Interest rates are important, of course, but don’t forget to check out other things, too. How secure your lender is, particularly in less buoyant economic times, is crucial. You might pay a bit more, but knowing the lender has a good reputation and isn’t about to fold will give you peace of mind. Upfront costs and how much you have to pay to get out of an arrangement – it could happen, so bear it in mind – are worth considering as well.

There are a number of variations on the two basic repayment and interest-only mortgages. Lenders are dreaming up new mortgage types – often the main models with a few tweaks around the edges – all the time. You need to ask questions to find out what is on offer and whether it will work for you.

Here are some examples:


A variation on the variable is a tracker mortgage, which moves up and down in tandem with the Bank of England mortgage base rate. Cheaper tracker mortgages might be a bit of a risk at times when it looks like the base rate is about to rise. However, when the base rate is steady, your mortgage rate stays where it is.

Capped Rate

A capped rate is a mix of variable and fixed rates if that doesn’t sound like a contradiction. What this means is the interest rate is variable (it can go up and down), but it cannot go over a certain amount for an agreed period of time.

Discount Rate

A discount rate based on the lender’s variable rate (again, one that goes up and down) is given to a buyer for a set amount of time. For instance, you might be offered a discount rate deal where you get 1% off the variable rate for one or two years.

Remember, a building society or bank is more likely to offer you an attractive discount rate if you put down a decent-sized deposit.

Cashback Mortgages

You get an extra lump sum of money at the start of your mortgage to spend on anything you want, but usually, it has to be linked to the house. This can help first-timers that need money upfront to buy furniture, pay solicitor’s fees or cover removal costs. Cashback mortgages are typically linked with a variable-rate mortgage.

Offset Mortgages

An offset mortgage lets you ‘offset’ savings from you, or maybe from friends or family, to cut down the interest you pay on your mortgage debt. Say, you have a mortgage of £120,000 and you can hand your lender savings of £20,000, then you only pay interest on £100,000, rather than on the total amount. This saves on the interest and might cut down on the length of time it takes you to pay off the entire mortgage.

Do talk to a good financial adviser, and also sound out your parents and friends who have already bought a home. Moreover, remember, what worked for someone else might not always be right for you. A lot depends on how much you earn, how steady your job is and how often you will be moving.


Trusting Alexander Jacobs property advisers makes sense and saves time:

  • Streamline your research.
  • Have a more comprehensive view of the offers that suit you.
  • Benefit from our in-depth knowledge of the local market and property owners in which we works in close collaboration to get their houses for sale in Retford on the market and sold fast. Everyone wins!

Register with us, to keep up-to-date and informed on houses for sale in Retford.

At Alexander Jacob, you have access to continuously updated ads on rental opportunities & property for sale in Retford, with new homes placed online each day. By registering with us, you will be making positive steps towards your dream home thanks to our multi-criterion search features and then receive by email corresponding ads; taking the stress out of the search.

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