Kia: Kia here. Welcome back to A Little Bit Richer. Property
Kia: is such a big thing for Brits. It can be
Kia: so difficult to get on the property ladder, but sometimes it
Kia: feels like everyone else is moving into their beautiful new home -
Kia: judging by their Instagram posts anyway. But if you don't
Kia: own your own home, are you actually behind in your
Kia: financial journey? Is it a good time to buy right now?
Kia: What are some of the things that you can do
Kia: to help make the buying process a little easier? With
Kia: me to discuss all of this and more is Tayo Oguntonade,
Kia: a mortgage broker, property expert, investor, and influencer. Okay. Tayo, property
Kia: prices are high, and mortgage rates have really rocketed. Is
Kia: buying a house now still a good idea?
Tayo Oguntonade: I have to chuckle at first! It's so funny. When you were doing the intro and saying
Tayo Oguntonade: all of those questions, it literally felt like you were
Tayo Oguntonade: reading my DMs. Those are all of the questions I
Tayo Oguntonade: get. It's great that we're addressing that today. I think the
Tayo Oguntonade: first thing to acknowledge is that it's incredibly difficult for
Tayo Oguntonade: all aspiring first- time buyers right now. We look at
Tayo Oguntonade: the last three years or so. The beginning of the pandemic,
Tayo Oguntonade: you could put down a 5% deposit. All of a sudden,
Tayo Oguntonade: in a matter of days, that was tripled to 15%.
Tayo Oguntonade: When they actually went back to 5% again, all of
Tayo Oguntonade: a sudden, house prices were shooting up because they introduced
Tayo Oguntonade: stamp duty holiday, mortgage payment holiday, and things like that. Then,
Tayo Oguntonade: when house prices actually started slowing down up to today,
Tayo Oguntonade: we saw that mortgage rates were increasing rapidly as well.
Tayo Oguntonade: It's really, really been a tough time. It feels like
Tayo Oguntonade: they've been pulled from pillar to post. I guess the
Tayo Oguntonade: first thing to acknowledge is that, yes, it is a very, very difficult
Tayo Oguntonade: time for first- time buyers right now. But I would
Tayo Oguntonade: say that if it is your goal to own your
Tayo Oguntonade: own property and buy your first property, you can still
Tayo Oguntonade: buy it right now. It is still possible. I always say
Tayo Oguntonade: that you shouldn't try and time the market. If you can
Tayo Oguntonade: afford it... What I mean by afford is afford to buy
Tayo Oguntonade: the house and afford the monthly payments on a long-
Tayo Oguntonade: term basis, and it is one of your goals. Definitely
Tayo Oguntonade: go ahead, in my opinion.
Kia: I think that's a really good point that you make. If
Kia: you try and time it's always not quite the right
Kia: time. It is just, like you said, getting in there.
Kia: If you're ready and you can afford it, jumping in
Kia: and doing it.
Tayo Oguntonade: Absolutely.
Kia: There's been some research done recently by L egal and General
Kia: that has found that, this year, financial support is more
Kia: important than ever. Over two- thirds of London homeowners received
Kia: financial support from family or friends. I'm going to ask you,
Kia: is it impossible if you don't have any financial help
Kia: from friends or family?
Tayo Oguntonade: It's not impossible. However, we cannot ignore the numbers and
Tayo Oguntonade: the research. I love numbers. I love any research. Do you know why?
Tayo Oguntonade: Because numbers have no opinion. You just have to acknowledge them.
Tayo Oguntonade: We have to take them for what they are basically.
Tayo Oguntonade: Those numbers are basically saying that there's a reason why
Tayo Oguntonade: so many people are leaning on family or leaning on
Tayo Oguntonade: siblings or friends or colleagues and buying with someone or
Tayo Oguntonade: getting financial assistance from someone. That's because it is becoming
Tayo Oguntonade: increasingly more difficult. Because I guess if you buy by yourself,
Tayo Oguntonade: a lot of the time, first- time buyers feel that
Tayo Oguntonade: they do have to sacrifice something. I'll come onto that.
Tayo Oguntonade: But what I would say is that whenever people think about
Tayo Oguntonade: financial assistance, a lot of the time, they do often
Tayo Oguntonade: think about the bank of Mum and Dad. When people
Tayo Oguntonade: think about the bank of Mum and Dad, they always
Tayo Oguntonade: think that, look, they've come from an ultra- wealthy family,
Tayo Oguntonade: but that's not often the case. This is why platforms
Tayo Oguntonade: like Bricks With Tips are made, and platforms like this podcast, right, because
Tayo Oguntonade: education is key. A lot of people are using that financial assistance,
Tayo Oguntonade: but it stems from education. If I paint a scenario,
Tayo Oguntonade: there might be somebody who has a job. They earn
Tayo Oguntonade: 30,000 pounds. They're working towards a promotion that will pay them 40,
Tayo Oguntonade: 000 pounds. However, they know that they're going to get
Tayo Oguntonade: that promotion in maybe the next two or three years effectively.
Tayo Oguntonade: They've been doing research on what it takes to buy a property.
Tayo Oguntonade: They know that, even at 40, 000 pounds, they still won't
Tayo Oguntonade: be able to afford the property that they want to
Tayo Oguntonade: buy effectively because they know that lenders will lend a
Tayo Oguntonade: certain amount, times their income. Also, via being educated, what
Tayo Oguntonade: they do know is that... " Hold on. My sister earns
Tayo Oguntonade: 30K as well. If we combine our salaries, it's 60,000 pounds."
Tayo Oguntonade: That education allows people to act early, basically. What we're
Tayo Oguntonade: experiencing at the moment is that a lot of people
Tayo Oguntonade: just don't know. They just pull the wool over their eyes.
Tayo Oguntonade: They're like. " It's difficult." They listen to the media. " It's impossible."
Tayo Oguntonade: They don't take any action. Then, just to touch on
Tayo Oguntonade: what you said about is it impossible. It is still
Tayo Oguntonade: possible to do it without financial assistance, but there are
Tayo Oguntonade: things that you may have to sacrifice. Maybe that's moving
Tayo Oguntonade: a little bit further out. Maybe that is opting for
Tayo Oguntonade: a two- bedroom flat rather than your dream of a three-
Tayo Oguntonade: bedroom house effectively. Yeah. I definitely do think that it is
Tayo Oguntonade: still possible. But in some cases, there may be an
Tayo Oguntonade: element of sacrifice.
Kia: I think I love the point that you made about
Kia: just learning and understanding. I think it is knowing what
Kia: can you do with the money that I've got, the money
Kia: that I'm on, the money that I've saved, what can
Kia: I realistically afford? I think that's the keyword. Realistically.
Tayo Oguntonade: Absolutely.
Kia: Because, like you said, I think everyone dreams about their
Kia: first home being a mansion somewhere. But realistically, your budget
Kia: may not stretch to that. I think that is a
Kia: key point. I want to go off the back of
Kia: something that you said. Let's talk about maybe buying with
Kia: someone then because I've spoken to people who have bought
Kia: with family. I think that's probably a bit more common.
Kia: But then, what about people buying with friends? What would you
Kia: say? Is that a good way to look at... maybe
Kia: people rally their friends together and say, " Let's buy property
Kia: together"? Or people will look at their siblings?
Tayo Oguntonade: Yeah. I definitely do think it's a good way to go.
Tayo Oguntonade: But you have to put certain things in place. I
Tayo Oguntonade: think that a lot of people are scared of it
Tayo Oguntonade: because buying a property is a long- term commitment. However,
Tayo Oguntonade: in this day and age, renting is a long- term commitment,
Tayo Oguntonade: especially if you're renting in places like London because, a
Tayo Oguntonade: lot of the time, you can't just jump around because
Tayo Oguntonade: renting in London is incredibly expensive. Every single time you
Tayo Oguntonade: change where you're renting, there is a cost attached to
Tayo Oguntonade: that as well, effectively. I do think that that is something
Tayo Oguntonade: to consider. I guess when you are buying, you are
Tayo Oguntonade: building equity over time, whether that's you paying down your
Tayo Oguntonade: mortgage or, depending on the market, the property increasing in
Tayo Oguntonade: value effectively. There are pros and cons of buying and
Tayo Oguntonade: renting that we can balance against each other. But in
Tayo Oguntonade: the main, biased I will be, buying is probably what you
Tayo Oguntonade: want to do just to ensure that you're building that equity
Tayo Oguntonade: and you've got more freedom to do what you want
Tayo Oguntonade: with your property. Buying with friends, buying with siblings, I
Tayo Oguntonade: am in support of it. I think it can allow people
Tayo Oguntonade: to achieve the goal that they're looking at.
Kia: Okay. Well, we never know. We might have some siblings
Kia: or some friends after hearing this banding together to buy
Kia: a house, which would be lovely to hear, wouldn't it?
Kia: We're going to come on to... Let's assume that our
Kia: listeners have decided that buying a house is what's right
Kia: for them. That's the right decision for them. What options/
Kia: schemes are available to make that goal more achievable for them?
Tayo Oguntonade: Right. There are quite a few options and schemes: some
Tayo Oguntonade: that people know about and some that people don't know about.
Tayo Oguntonade: The ones that people probably know about the most are
Tayo Oguntonade: government schemes. For example, some of the two most popular
Tayo Oguntonade: ones are shared ownership. I always give the example. Shared
Tayo Oguntonade: ownership is effectively you buying a share of a property
Tayo Oguntonade: and renting the rest of the property. A really easy
Tayo Oguntonade: scenario is that, in London, there's a flat that's 400,000 pounds.
Tayo Oguntonade: You can buy a 25% share of that flat, which means
Tayo Oguntonade: that you buy 100K of that flat effectively. You rent
Tayo Oguntonade: the remaining three- quarters of that flat effectively. The reason
Tayo Oguntonade: why it's popular is because it's got really, really low
Tayo Oguntonade: startup costs. You don't need to put a huge amount
Tayo Oguntonade: down because, in actual fact, when you're buying that 25%
Tayo Oguntonade: share at 100K, you can put down a deposit as
Tayo Oguntonade: low as 5%, which means that you can put down 5,
Tayo Oguntonade: 000 pounds to live in a 400K flat. Naturally, that's
Tayo Oguntonade: going to get a lot of attention. Another scheme that a lot of
Tayo Oguntonade: people know about is Right to Buy. That's when you
Tayo Oguntonade: can buy the council flat that you live in if
Tayo Oguntonade: you've lived in there for three years or more effectively.
Tayo Oguntonade: There are some government schemes that are less known. For example,
Tayo Oguntonade: there's one called First Home Scheme, where you can get
Tayo Oguntonade: between 30 and 50% off your first home. There's another one called
Tayo Oguntonade: Help to Build because Help to Buy no longer exists.
Tayo Oguntonade: Help to Build can actually help you finance the land
Tayo Oguntonade: and the build of a self- build property, which is really,
Tayo Oguntonade: really interesting. Then, another one that a lot of people
Tayo Oguntonade: don't know is that there are actually some schemes that
Tayo Oguntonade: are offered by lenders, first of all, and definitely have
Tayo Oguntonade: a look and check those out, and also home builders
Tayo Oguntonade: as well because there is an incentive for them to
Tayo Oguntonade: sell their homes.
Kia: That's really good to hear you share all those different
Kia: schemes because I think sometimes, as a first- time buyer...
Kia: It is overwhelming, anyway, for anyone trying to buy a property,
Kia: but especially if you're trying to understand what's going to
Kia: work for you, knowing that there's so many options out
Kia: there. It's just finding the right one for you. Maybe
Kia: it's shared ownership, maybe it's first homes, maybe it's something
Kia: else. But I think it is good to know. One
Kia: of my favorite schemes, which isn't necessarily for buying, but... Do you know what I'm
Kia: going to say? What scheme I'm going to say?
Tayo Oguntonade: I know what you're going to say.
Kia: What am I going to say?
Tayo Oguntonade: It begins with L.
Kia: It does.
Tayo Oguntonade: It ends with ISA.
Kia: It does. You got it bang on. My favourite scheme is the Lifetime ISA because
Kia: it's just a great savings vehicle. For anyone who doesn't know,
Kia: the Lifetime ISA is a savings vehicle. It's superseded the Help to Buy ISA,
Kia: which closed, I think, in 2019. You can use that
Kia: to save for your first house. You put money in
Kia: there up to 4, 000 pounds per tax year. You can
Kia: keep saving that money. The government will put 25% on
Kia: top of anything that you save up until that amount.
Kia: You can use that towards your deposit. It's also important
Kia: to note. You have to have it open for at
Kia: least a year, but you can use it. But it
Kia: is a great way to save money and get free money.
Kia: That's always my thing. Anytime we can get some extra
Kia: money towards our financial goals, I'm all for it. The Lifetime
Kia: ISA is a great way to do that from the government.
Kia: I think all those schemes combined, there is a lot
Kia: of hope for anyone listening when it comes to buying
Kia: first property.
Tayo Oguntonade: Absolutely. To add to what you said about the Lifetime ISA, the difference between Lifetime ISA and all of those
Tayo Oguntonade: other schemes is that, with the Lifetime ISA... It can be applied to property...
Kia: To any property.
Tayo Oguntonade: Exactly that. That's really, really nice, the flexibility of that.
Kia: Yeah, I love that. Right. To wrap up then, with property
Kia: in mind, I'm going to ask you the question I
Kia: ask all of our guests. What are the three quick
Kia: tips that you'd recommend to our listeners to help them
Kia: get a little bit richer?
Tayo Oguntonade: With property in mind, getting a little bit richer... Okay,
Tayo Oguntonade: cool. I'm big on education. Knowing what you're doing is
Tayo Oguntonade: key effectively. My first tip is speak to a mortgage
Tayo Oguntonade: broker. In the property space, a lot of things aren't
Tayo Oguntonade: free. Getting a survey done isn't free. Getting a valuation
Tayo Oguntonade: done isn't free. Getting a quote from an architect isn't
Tayo Oguntonade: free. However, a mortgage broker will actually speak to you
Tayo Oguntonade: for free. It's very, very rare that you can get
Tayo Oguntonade: such a tailored and one- to- one service for free
Tayo Oguntonade: in any other industry. A mortgage broker will assess your
Tayo Oguntonade: current situation and tell you what you can and can't
Tayo Oguntonade: do. My second tip... Go on viewings, whether they're virtual
Tayo Oguntonade: viewings or viewings in person. I think that one mistake
Tayo Oguntonade: that a lot of people make is that they fix
Tayo Oguntonade: their credit. They save their money. They get their salary
Tayo Oguntonade: up. Then, they've been doing that for two or three
Tayo Oguntonade: years. Then, the problem is that they spend nine months
Tayo Oguntonade: after that working out what type of property they want.
Tayo Oguntonade: While they're working that out, their budget is going all over
Tayo Oguntonade: the place as well. Find out what you like in
Tayo Oguntonade: a property. Find out what you love. Find out what
Tayo Oguntonade: you hate. Find out what you're willing to compromise on.
Tayo Oguntonade: That way, you know exactly how much money you need
Tayo Oguntonade: because you know the type of property you want in what area.
Tayo Oguntonade: It goes to education as well. Wherever you consume any
Tayo Oguntonade: of your content, whether you're on Twitter, whether you're on
Tayo Oguntonade: Instagram, whether you use YouTube, or maybe you read print,
Tayo Oguntonade: just curate everything that you do and make it property-
Tayo Oguntonade: focused effectively. You'll pick up new tips. You'll pick up
Tayo Oguntonade: new ways to overcome challenges that you are actually facing because one
Tayo Oguntonade: of the key things is... And you alluded to it a
Tayo Oguntonade: bit earlier when we were speaking, is that once you
Tayo Oguntonade: know about all of these different schemes, the key thing
Tayo Oguntonade: is that you can now apply it to your personal situation.
Kia: You gave some great tips. I think the key takeaways
Kia: that I pull from this episode is, one, education is
Kia: key. Make sure you research/ you understand what you're looking
Kia: to get into when it comes to buying a property
Kia: and, two, that there is hope. It may seem a
Kia: bit bleak. Things are going up in price and not
Kia: seeming to come down. But there is still hope. If
Kia: you want to get on the property ladder, it isn't as impossible
Kia: as it may seem. Thank you so much, Tayo, for coming on.
Kia: This has been a great episode. That's A Little Bit Richer's first foray
Kia: into the huge topic that is property. I'll be back
Kia: to this a little bit later in a series, too.
Kia: It's worth noting that, as with all things to do
Kia: with interest rates and house buying, it's always worth double-
Kia: checking if things have changed before you make any big
Kia: decisions. This episode is all about taking control of your property-
Kia: buying journey. But, unfortunately, financial freedom isn't always a given.
Kia: Next week is a particularly important episode as I'll be
Kia: exploring what financial abuse is and how to recognize the
Kia: signs of it around you. Be sure to check back
Kia: next week for that. In the meantime, follow the podcast
Kia: if you aren't already. Bye.