WEBVTT - Make Your Property Dreams Come True 0:00:01.080 --> 0:00:04.710 Kia here. Welcome back to A Little Bit Richer. Property 0:00:04.710 --> 0:00:06.900 is such a big thing for Brits. It can be 0:00:06.900 --> 0:00:10.110 so difficult to get on the property ladder, but sometimes it 0:00:10.110 --> 0:00:12.959 feels like everyone else is moving into their beautiful new home - 0:00:13.410 --> 0:00:16.288 judging by their Instagram posts anyway. But if you don't 0:00:16.289 --> 0:00:18.989 own your own home, are you actually behind in your 0:00:18.989 --> 0:00:22.349 financial journey? Is it a good time to buy right now? 0:00:22.680 --> 0:00:24.240 What are some of the things that you can do 0:00:24.300 --> 0:00:27.900 to help make the buying process a little easier? With 0:00:27.900 --> 0:00:31.080 me to discuss all of this and more is Tayo Oguntonade, 0:00:31.620 --> 0:00:38.970 a mortgage broker, property expert, investor, and influencer. Okay. Tayo, property 0:00:38.970 --> 0:00:43.260 prices are high, and mortgage rates have really rocketed. Is 0:00:43.260 --> 0:00:45.570 buying a house now still a good idea? 0:00:47.550 --> 0:00:49.920 I have to chuckle at first! It's so funny. When you were doing the intro and saying 0:00:49.920 --> 0:00:52.469 all of those questions, it literally felt like you were 0:00:52.469 --> 0:00:55.560 reading my DMs. Those are all of the questions I 0:00:55.560 --> 0:00:57.870 get. It's great that we're addressing that today. I think the 0:00:57.870 --> 0:01:00.720 first thing to acknowledge is that it's incredibly difficult for 0:01:00.720 --> 0:01:03.269 all aspiring first- time buyers right now. We look at 0:01:03.270 --> 0:01:06.240 the last three years or so. The beginning of the pandemic, 0:01:06.300 --> 0:01:09.328 you could put down a 5% deposit. All of a sudden, 0:01:09.330 --> 0:01:11.519 in a matter of days, that was tripled to 15%. 0:01:11.910 --> 0:01:14.700 When they actually went back to 5% again, all of 0:01:14.700 --> 0:01:17.430 a sudden, house prices were shooting up because they introduced 0:01:17.430 --> 0:01:20.789 stamp duty holiday, mortgage payment holiday, and things like that. Then, 0:01:20.789 --> 0:01:23.578 when house prices actually started slowing down up to today, 0:01:23.580 --> 0:01:26.970 we saw that mortgage rates were increasing rapidly as well. 0:01:27.509 --> 0:01:29.910 It's really, really been a tough time. It feels like 0:01:29.910 --> 0:01:32.430 they've been pulled from pillar to post. I guess the 0:01:32.430 --> 0:01:35.580 first thing to acknowledge is that, yes, it is a very, very difficult 0:01:35.580 --> 0:01:37.919 time for first- time buyers right now. But I would 0:01:37.920 --> 0:01:40.590 say that if it is your goal to own your 0:01:40.590 --> 0:01:43.889 own property and buy your first property, you can still 0:01:43.889 --> 0:01:46.859 buy it right now. It is still possible. I always say 0:01:46.859 --> 0:01:50.250 that you shouldn't try and time the market. If you can 0:01:50.430 --> 0:01:53.070 afford it... What I mean by afford is afford to buy 0:01:53.070 --> 0:01:55.860 the house and afford the monthly payments on a long- 0:01:55.860 --> 0:01:58.410 term basis, and it is one of your goals. Definitely 0:01:58.410 --> 0:01:59.400 go ahead, in my opinion. 0:01:59.490 --> 0:02:03.420 I think that's a really good point that you make. If 0:02:03.420 --> 0:02:06.000 you try and time it's always not quite the right 0:02:06.000 --> 0:02:08.310 time. It is just, like you said, getting in there. 0:02:08.310 --> 0:02:10.680 If you're ready and you can afford it, jumping in 0:02:10.889 --> 0:02:11.550 and doing it. 0:02:11.639 --> 0:02:12.179 Absolutely. 0:02:13.320 --> 0:02:16.410 There's been some research done recently by L egal and General 0:02:16.410 --> 0:02:20.130 that has found that, this year, financial support is more 0:02:20.130 --> 0:02:24.209 important than ever. Over two- thirds of London homeowners received 0:02:24.300 --> 0:02:27.960 financial support from family or friends. I'm going to ask you, 0:02:28.470 --> 0:02:32.220 is it impossible if you don't have any financial help 0:02:32.220 --> 0:02:33.600 from friends or family? 0:02:34.020 --> 0:02:36.779 It's not impossible. However, we cannot ignore the numbers and 0:02:36.780 --> 0:02:40.049 the research. I love numbers. I love any research. Do you know why? 0:02:40.049 --> 0:02:43.620 Because numbers have no opinion. You just have to acknowledge them. 0:02:43.620 --> 0:02:45.480 We have to take them for what they are basically. 0:02:45.900 --> 0:02:49.080 Those numbers are basically saying that there's a reason why 0:02:49.080 --> 0:02:53.340 so many people are leaning on family or leaning on 0:02:53.340 --> 0:02:55.799 siblings or friends or colleagues and buying with someone or 0:02:55.799 --> 0:02:59.100 getting financial assistance from someone. That's because it is becoming 0:02:59.100 --> 0:03:02.850 increasingly more difficult. Because I guess if you buy by yourself, 0:03:03.210 --> 0:03:05.100 a lot of the time, first- time buyers feel that 0:03:05.100 --> 0:03:08.820 they do have to sacrifice something. I'll come onto that. 0:03:09.120 --> 0:03:11.370 But what I would say is that whenever people think about 0:03:11.370 --> 0:03:14.459 financial assistance, a lot of the time, they do often 0:03:14.460 --> 0:03:16.799 think about the bank of Mum and Dad. When people 0:03:16.799 --> 0:03:18.780 think about the bank of Mum and Dad, they always 0:03:18.780 --> 0:03:23.040 think that, look, they've come from an ultra- wealthy family, 0:03:23.820 --> 0:03:26.399 but that's not often the case. This is why platforms 0:03:26.400 --> 0:03:30.090 like Bricks With Tips are made, and platforms like this podcast, right, because 0:03:30.090 --> 0:03:34.920 education is key. A lot of people are using that financial assistance, 0:03:34.920 --> 0:03:37.380 but it stems from education. If I paint a scenario, 0:03:37.380 --> 0:03:40.560 there might be somebody who has a job. They earn 0:03:40.560 --> 0:03:43.590 30,000 pounds. They're working towards a promotion that will pay them 40, 0:03:43.590 --> 0:03:47.189 000 pounds. However, they know that they're going to get 0:03:47.190 --> 0:03:50.130 that promotion in maybe the next two or three years effectively. 0:03:50.520 --> 0:03:52.950 They've been doing research on what it takes to buy a property. 0:03:53.160 --> 0:03:56.070 They know that, even at 40, 000 pounds, they still won't 0:03:56.070 --> 0:03:58.440 be able to afford the property that they want to 0:03:58.440 --> 0:04:00.990 buy effectively because they know that lenders will lend a 0:04:00.990 --> 0:04:05.009 certain amount, times their income. Also, via being educated, what 0:04:05.010 --> 0:04:07.799 they do know is that... " Hold on. My sister earns 0:04:07.799 --> 0:04:12.089 30K as well. If we combine our salaries, it's 60,000 pounds." 0:04:12.630 --> 0:04:15.840 That education allows people to act early, basically. What we're 0:04:16.170 --> 0:04:18.330 experiencing at the moment is that a lot of people 0:04:18.330 --> 0:04:20.939 just don't know. They just pull the wool over their eyes. 0:04:20.940 --> 0:04:24.089 They're like. " It's difficult." They listen to the media. " It's impossible." 0:04:24.210 --> 0:04:26.428 They don't take any action. Then, just to touch on 0:04:26.428 --> 0:04:29.369 what you said about is it impossible. It is still 0:04:29.369 --> 0:04:31.919 possible to do it without financial assistance, but there are 0:04:31.920 --> 0:04:34.590 things that you may have to sacrifice. Maybe that's moving 0:04:34.890 --> 0:04:38.309 a little bit further out. Maybe that is opting for 0:04:38.309 --> 0:04:40.678 a two- bedroom flat rather than your dream of a three- 0:04:40.678 --> 0:04:44.219 bedroom house effectively. Yeah. I definitely do think that it is 0:04:44.219 --> 0:04:46.440 still possible. But in some cases, there may be an 0:04:46.440 --> 0:04:47.520 element of sacrifice. 0:04:47.760 --> 0:04:49.620 I think I love the point that you made about 0:04:50.100 --> 0:04:53.700 just learning and understanding. I think it is knowing what 0:04:53.700 --> 0:04:55.560 can you do with the money that I've got, the money 0:04:55.770 --> 0:04:57.988 that I'm on, the money that I've saved, what can 0:04:57.990 --> 0:05:00.600 I realistically afford? I think that's the keyword. Realistically. 0:05:00.660 --> 0:05:00.990 Absolutely. 0:05:00.990 --> 0:05:03.479 Because, like you said, I think everyone dreams about their 0:05:03.480 --> 0:05:06.810 first home being a mansion somewhere. But realistically, your budget 0:05:06.810 --> 0:05:09.089 may not stretch to that. I think that is a 0:05:09.089 --> 0:05:10.620 key point. I want to go off the back of 0:05:10.620 --> 0:05:13.920 something that you said. Let's talk about maybe buying with 0:05:13.920 --> 0:05:17.490 someone then because I've spoken to people who have bought 0:05:17.610 --> 0:05:20.670 with family. I think that's probably a bit more common. 0:05:20.910 --> 0:05:22.830 But then, what about people buying with friends? What would you 0:05:22.830 --> 0:05:25.950 say? Is that a good way to look at... maybe 0:05:25.950 --> 0:05:28.080 people rally their friends together and say, " Let's buy property 0:05:28.080 --> 0:05:29.940 together"? Or people will look at their siblings? 0:05:30.000 --> 0:05:32.549 Yeah. I definitely do think it's a good way to go. 0:05:32.550 --> 0:05:34.920 But you have to put certain things in place. I 0:05:34.920 --> 0:05:36.599 think that a lot of people are scared of it 0:05:36.599 --> 0:05:40.438 because buying a property is a long- term commitment. However, 0:05:40.500 --> 0:05:42.599 in this day and age, renting is a long- term commitment, 0:05:42.990 --> 0:05:45.510 especially if you're renting in places like London because, a 0:05:45.510 --> 0:05:47.190 lot of the time, you can't just jump around because 0:05:47.339 --> 0:05:50.610 renting in London is incredibly expensive. Every single time you 0:05:50.610 --> 0:05:52.589 change where you're renting, there is a cost attached to 0:05:52.589 --> 0:05:55.740 that as well, effectively. I do think that that is something 0:05:55.740 --> 0:05:58.049 to consider. I guess when you are buying, you are 0:05:58.049 --> 0:06:00.719 building equity over time, whether that's you paying down your 0:06:00.720 --> 0:06:04.260 mortgage or, depending on the market, the property increasing in 0:06:04.260 --> 0:06:07.289 value effectively. There are pros and cons of buying and 0:06:07.290 --> 0:06:09.660 renting that we can balance against each other. But in 0:06:09.660 --> 0:06:13.770 the main, biased I will be, buying is probably what you 0:06:13.770 --> 0:06:16.290 want to do just to ensure that you're building that equity 0:06:16.529 --> 0:06:19.020 and you've got more freedom to do what you want 0:06:19.020 --> 0:06:21.779 with your property. Buying with friends, buying with siblings, I 0:06:21.779 --> 0:06:24.420 am in support of it. I think it can allow people 0:06:24.420 --> 0:06:25.950 to achieve the goal that they're looking at. 0:06:26.190 --> 0:06:28.500 Okay. Well, we never know. We might have some siblings 0:06:28.500 --> 0:06:31.380 or some friends after hearing this banding together to buy 0:06:31.380 --> 0:06:33.029 a house, which would be lovely to hear, wouldn't it? 0:06:33.870 --> 0:06:36.089 We're going to come on to... Let's assume that our 0:06:36.150 --> 0:06:39.360 listeners have decided that buying a house is what's right 0:06:39.360 --> 0:06:41.970 for them. That's the right decision for them. What options/ 0:06:42.240 --> 0:06:46.049 schemes are available to make that goal more achievable for them? 0:06:46.320 --> 0:06:49.770 Right. There are quite a few options and schemes: some 0:06:49.770 --> 0:06:52.618 that people know about and some that people don't know about. 0:06:53.070 --> 0:06:54.779 The ones that people probably know about the most are 0:06:54.779 --> 0:06:58.470 government schemes. For example, some of the two most popular 0:06:58.470 --> 0:07:01.680 ones are shared ownership. I always give the example. Shared 0:07:01.680 --> 0:07:04.950 ownership is effectively you buying a share of a property 0:07:05.250 --> 0:07:08.070 and renting the rest of the property. A really easy 0:07:08.428 --> 0:07:12.869 scenario is that, in London, there's a flat that's 400,000 pounds. 0:07:13.200 --> 0:07:16.560 You can buy a 25% share of that flat, which means 0:07:16.560 --> 0:07:19.980 that you buy 100K of that flat effectively. You rent 0:07:19.980 --> 0:07:23.099 the remaining three- quarters of that flat effectively. The reason 0:07:23.099 --> 0:07:24.870 why it's popular is because it's got really, really low 0:07:25.320 --> 0:07:26.939 startup costs. You don't need to put a huge amount 0:07:26.940 --> 0:07:30.359 down because, in actual fact, when you're buying that 25% 0:07:30.360 --> 0:07:33.660 share at 100K, you can put down a deposit as 0:07:33.660 --> 0:07:36.630 low as 5%, which means that you can put down 5, 0:07:36.630 --> 0:07:40.170 000 pounds to live in a 400K flat. Naturally, that's 0:07:40.170 --> 0:07:43.050 going to get a lot of attention. Another scheme that a lot of 0:07:43.259 --> 0:07:45.779 people know about is Right to Buy. That's when you 0:07:45.780 --> 0:07:48.539 can buy the council flat that you live in if 0:07:48.540 --> 0:07:50.730 you've lived in there for three years or more effectively. 0:07:50.940 --> 0:07:53.670 There are some government schemes that are less known. For example, 0:07:53.670 --> 0:07:56.220 there's one called First Home Scheme, where you can get 0:07:56.220 --> 0:08:00.150 between 30 and 50% off your first home. There's another one called 0:08:00.150 --> 0:08:02.850 Help to Build because Help to Buy no longer exists. 0:08:02.940 --> 0:08:05.910 Help to Build can actually help you finance the land 0:08:06.000 --> 0:08:08.250 and the build of a self- build property, which is really, 0:08:08.250 --> 0:08:10.440 really interesting. Then, another one that a lot of people 0:08:10.440 --> 0:08:13.080 don't know is that there are actually some schemes that 0:08:13.080 --> 0:08:16.019 are offered by lenders, first of all, and definitely have 0:08:16.020 --> 0:08:18.540 a look and check those out, and also home builders 0:08:18.540 --> 0:08:20.309 as well because there is an incentive for them to 0:08:20.309 --> 0:08:21.060 sell their homes. 0:08:21.360 --> 0:08:24.540 That's really good to hear you share all those different 0:08:24.540 --> 0:08:27.030 schemes because I think sometimes, as a first- time buyer... 0:08:27.060 --> 0:08:29.940 It is overwhelming, anyway, for anyone trying to buy a property, 0:08:30.210 --> 0:08:32.218 but especially if you're trying to understand what's going to 0:08:32.220 --> 0:08:34.170 work for you, knowing that there's so many options out 0:08:34.170 --> 0:08:36.960 there. It's just finding the right one for you. Maybe 0:08:36.960 --> 0:08:39.299 it's shared ownership, maybe it's first homes, maybe it's something 0:08:39.299 --> 0:08:41.939 else. But I think it is good to know. One 0:08:41.940 --> 0:08:45.510 of my favorite schemes, which isn't necessarily for buying, but... Do you know what I'm 0:08:46.200 --> 0:08:47.221 going to say? What scheme I'm going to say? 0:08:47.221 --> 0:08:48.120 I know what you're going to say. 0:08:48.390 --> 0:08:48.809 What am I going to say? 0:08:48.810 --> 0:08:48.811 It begins with L. 0:08:48.811 --> 0:08:48.812 It does. 0:08:48.812 --> 0:08:48.813 It ends with ISA. 0:08:48.813 --> 0:08:58.980 It does. You got it bang on. My favourite scheme is the Lifetime ISA because 0:08:59.219 --> 0:09:01.920 it's just a great savings vehicle. For anyone who doesn't know, 0:09:01.920 --> 0:09:06.150 the Lifetime ISA is a savings vehicle. It's superseded the Help to Buy ISA, 0:09:06.179 --> 0:09:10.679 which closed, I think, in 2019. You can use that 0:09:10.679 --> 0:09:12.269 to save for your first house. You put money in 0:09:12.270 --> 0:09:15.749 there up to 4, 000 pounds per tax year. You can 0:09:15.750 --> 0:09:18.269 keep saving that money. The government will put 25% on 0:09:18.270 --> 0:09:20.250 top of anything that you save up until that amount. 0:09:21.000 --> 0:09:23.250 You can use that towards your deposit. It's also important 0:09:23.250 --> 0:09:24.450 to note. You have to have it open for at 0:09:24.450 --> 0:09:25.860 least a year, but you can use it. But it 0:09:25.860 --> 0:09:28.500 is a great way to save money and get free money. 0:09:28.500 --> 0:09:30.809 That's always my thing. Anytime we can get some extra 0:09:30.809 --> 0:09:34.740 money towards our financial goals, I'm all for it. The Lifetime 0:09:34.920 --> 0:09:36.720 ISA is a great way to do that from the government. 0:09:37.350 --> 0:09:39.838 I think all those schemes combined, there is a lot 0:09:39.840 --> 0:09:42.150 of hope for anyone listening when it comes to buying 0:09:42.150 --> 0:09:42.660 first property. 0:09:42.660 --> 0:09:46.828 Absolutely. To add to what you said about the Lifetime ISA, the difference between Lifetime ISA and all of those 0:09:46.830 --> 0:09:49.710 other schemes is that, with the Lifetime ISA... It can be applied to property... 0:09:49.710 --> 0:09:50.399 To any property. 0:09:50.880 --> 0:09:53.549 Exactly that. That's really, really nice, the flexibility of that. 0:09:53.670 --> 0:09:58.080 Yeah, I love that. Right. To wrap up then, with property 0:09:58.080 --> 0:09:59.968 in mind, I'm going to ask you the question I 0:09:59.970 --> 0:10:03.449 ask all of our guests. What are the three quick 0:10:03.450 --> 0:10:05.730 tips that you'd recommend to our listeners to help them 0:10:05.730 --> 0:10:06.930 get a little bit richer? 0:10:07.230 --> 0:10:10.230 With property in mind, getting a little bit richer... Okay, 0:10:10.230 --> 0:10:13.800 cool. I'm big on education. Knowing what you're doing is 0:10:13.800 --> 0:10:16.650 key effectively. My first tip is speak to a mortgage 0:10:16.650 --> 0:10:19.738 broker. In the property space, a lot of things aren't 0:10:19.740 --> 0:10:22.530 free. Getting a survey done isn't free. Getting a valuation 0:10:22.530 --> 0:10:25.170 done isn't free. Getting a quote from an architect isn't 0:10:25.170 --> 0:10:27.629 free. However, a mortgage broker will actually speak to you 0:10:27.630 --> 0:10:30.029 for free. It's very, very rare that you can get 0:10:30.029 --> 0:10:33.600 such a tailored and one- to- one service for free 0:10:33.600 --> 0:10:36.780 in any other industry. A mortgage broker will assess your 0:10:36.780 --> 0:10:38.939 current situation and tell you what you can and can't 0:10:38.940 --> 0:10:42.509 do. My second tip... Go on viewings, whether they're virtual 0:10:42.509 --> 0:10:45.389 viewings or viewings in person. I think that one mistake 0:10:45.389 --> 0:10:47.429 that a lot of people make is that they fix 0:10:47.429 --> 0:10:50.819 their credit. They save their money. They get their salary 0:10:50.820 --> 0:10:52.920 up. Then, they've been doing that for two or three 0:10:52.920 --> 0:10:55.828 years. Then, the problem is that they spend nine months 0:10:55.830 --> 0:10:57.690 after that working out what type of property they want. 0:10:58.290 --> 0:11:00.179 While they're working that out, their budget is going all over 0:11:00.179 --> 0:11:02.729 the place as well. Find out what you like in 0:11:02.730 --> 0:11:05.339 a property. Find out what you love. Find out what 0:11:05.340 --> 0:11:07.708 you hate. Find out what you're willing to compromise on. 0:11:07.950 --> 0:11:09.870 That way, you know exactly how much money you need 0:11:09.870 --> 0:11:12.150 because you know the type of property you want in what area. 0:11:12.420 --> 0:11:15.240 It goes to education as well. Wherever you consume any 0:11:15.240 --> 0:11:17.820 of your content, whether you're on Twitter, whether you're on 0:11:17.849 --> 0:11:21.030 Instagram, whether you use YouTube, or maybe you read print, 0:11:21.030 --> 0:11:24.600 just curate everything that you do and make it property- 0:11:24.600 --> 0:11:27.690 focused effectively. You'll pick up new tips. You'll pick up 0:11:27.960 --> 0:11:31.230 new ways to overcome challenges that you are actually facing because one 0:11:31.230 --> 0:11:33.420 of the key things is... And you alluded to it a 0:11:33.420 --> 0:11:35.700 bit earlier when we were speaking, is that once you 0:11:35.700 --> 0:11:38.160 know about all of these different schemes, the key thing 0:11:38.160 --> 0:11:40.680 is that you can now apply it to your personal situation. 0:11:40.889 --> 0:11:43.468 You gave some great tips. I think the key takeaways 0:11:43.470 --> 0:11:46.320 that I pull from this episode is, one, education is 0:11:46.320 --> 0:11:49.348 key. Make sure you research/ you understand what you're looking 0:11:49.679 --> 0:11:51.390 to get into when it comes to buying a property 0:11:51.750 --> 0:11:54.718 and, two, that there is hope. It may seem a 0:11:54.719 --> 0:11:56.940 bit bleak. Things are going up in price and not 0:11:56.940 --> 0:11:59.010 seeming to come down. But there is still hope. If 0:11:59.010 --> 0:12:01.380 you want to get on the property ladder, it isn't as impossible 0:12:01.380 --> 0:12:03.780 as it may seem. Thank you so much, Tayo, for coming on. 0:12:03.960 --> 0:12:08.910 This has been a great episode. That's A Little Bit Richer's first foray 0:12:08.910 --> 0:12:11.790 into the huge topic that is property. I'll be back 0:12:11.790 --> 0:12:13.740 to this a little bit later in a series, too. 0:12:14.190 --> 0:12:15.868 It's worth noting that, as with all things to do 0:12:15.870 --> 0:12:18.660 with interest rates and house buying, it's always worth double- 0:12:18.660 --> 0:12:21.030 checking if things have changed before you make any big 0:12:21.030 --> 0:12:24.750 decisions. This episode is all about taking control of your property- 0:12:24.750 --> 0:12:29.160 buying journey. But, unfortunately, financial freedom isn't always a given. 0:12:29.880 --> 0:12:33.059 Next week is a particularly important episode as I'll be 0:12:33.059 --> 0:12:36.088 exploring what financial abuse is and how to recognize the 0:12:36.090 --> 0:12:38.550 signs of it around you. Be sure to check back 0:12:38.550 --> 0:12:41.220 next week for that. In the meantime, follow the podcast 0:12:41.250 --> 0:12:42.900 if you aren't already. Bye.