Cheapest properties you can buy now with tiny deposit of just £1,750 – including 3-bed terrace
HOUSE prices are creeping up again and wannabe buyers might be feeling less confident about their prospects of getting on the ladder.
Zoopla said the average house price is around £264,900 in May, with the average set to rise pay 1.5% by the end of the year.
This might seem pretty unaffordable for most buyers, as it means you would have to save more than £13,245 even for a 5% deposit.
To put down a 10% deposit and secure a lower mortgage rate, you’d need a staggering £25,490 in savings.
But for hopeful homeowners without a huge nest egg, there are some properties out there that won’t break the bank.
Property website Zoopla has dug out ten properties in the UK that cost £40,000 or under, requiring a 5% deposit of £1,750 or less.
Remember that flats this cheap usually come with some kind of baggage and often need a lot of work done to them.
It’s worth getting a survey done before buying as it could help you avoid unexpected repair costs further down the line.
It will also give you a steer as to how much you might need to invest in the property.
Meanwhile, check what the ground rent is – this is what you are charged for renting out the land from the freeholder.
Factor in service charges as well, which cover buildings insurance, maintenance, repairs, gardening and communal facilities.
Next, remember you’ll need extra cash in the bank to pay for legal and valuation fees.
And always check what the leasehold length is on a property as shorter ones cost a lot to extend.
Mortgage lenders also tend not to lend on properties with a lease that’s already below the 80-year mark.
One-bedroom flat, Liverpool – £2,000 deposit
This one-bed flat in Liverpool is in the market for just £40,000.
It’s located in the city centre and is less than a mile away from both Liverpool Lime Street station and Liverpool Central.
There’s also a gym on-site and a concierge service.
The lounge and kitchen are open-plan and there is a separate bedroom and bathroom.
Two-bedroom terraced house, Shildon – £2,000 deposit
This two-bedroom house in Shildon, County Durham is also available for £40,000.
But the property needs significant work doing to it, with all the living spaces having fallen to disrepair.
There are two schools nearby so it would suit a small family, plus it’s near both Shildon and Bishop Auckland station.
Studio apartment, Isle Of Bute – £1,750 deposit
This studio apartment is located on the stunning Isle of Bute – an island in the Firth of Clyde in Scotland – and is up for sale for £35,000.
It has partial sea and hill views and is located just off the seafront, with the marina, post office and a local shop all in walking distance.
It’s important to note though, that Zoopla describes the property as “compact bedsit”, meaning it doesn’t have much potential to be turned into a family home.
There is currently a hallway, living room, kitchen and a bathroom in the property.
So if you were to purchase this space, you lounge may have to double up as a bedroom, so that’s something to bear in mind.
One-bedroom flat, Dundee – £2,000 deposit
This one-bedroom flat in Dundee, Scotland, is on the market for £40,000.
It has recently been refurbished, giving it a modern and clean feel.
The apartment also has electric heating, laminate flooring, double glazing and a walk-in storage area.
Plus, it has a shared garden and both allocated and on-street parking.
The apartment is close to the city centre, universities, school and the local hospital.
One-bedroom flat, Motherwell – £1,750 deposit
This one-bedroom flat in Motherwell is on the market for just £35,000.
Zoopla describes it as “the perfect opportunity for a first-time buyer” because of its location in the friendly neighbourhood of Motherwell.
It has a spacious lounge, a modern kitchen and a one-piece bathroom.
Three-bedroom house, Peterlee – £2,000 deposit
This three-bedroom property in Peterlee, County Durham, needs significant work doing to it but it could be a good investment.
The entranceway leads to a kitchen, living room and a family bathroom.
Its three bedrooms are all located on the first floor.
The house also has a fully enclosed south facing courtyard and a grassed area at the front.
Two-bedroom park home, Devon, – £1,497 deposit
Park homes are like a static caravan or chalet that you might stay in on holiday – but you can live in them all year round.
Typically they are for older people retiring to a smaller place, but this lovely seaside property could appeal to a wide-range of buyers.
It’s located in Bideford, Devon, and has direct access to the southwest coastal path and resident parking.
There’s also a clubhouse, restaurant and swimming pool on site for the buyer to make use of.
How to get the best deal on your mortgage
IF you're looking for a traditional type of mortgage, getting the best rates depends entirely on what's available at any given time.
There are several ways to land the best deal.
Usually the larger the deposit you have the lower the rate you can get.
If you’re remortgaging and your loan-to-value ratio (LTV) has changed, you’ll get access to better rates than before.
Your LTV will go down if your outstanding mortgage is lower and/or your home’s value is higher.
A change to your credit score or a better salary could also help you access better rates.
And if you’re nearing the end of a fixed deal soon it’s worth looking for new deals now.
You can lock in current deals sometimes up to six months before your current deal ends.
Leaving a fixed deal early will usually come with an early exit fee, so you want to avoid this extra cost.
But depending on the cost and how much you could save by switching versus sticking, it could be worth paying to leave the deal – but compare the costs first.
To find the best deal use a mortgage comparison tool to see what’s available.
You can also go to a mortgage broker who can compare a much larger range of deals for you.
Some will charge an extra fee but there are plenty who give advice for free and get paid only on commission from the lender.
You’ll also need to factor in fees for the mortgage, though some have no fees at all.
You can add the fee – sometimes more than £1,000 – to the cost of the mortgage, but be aware that means you’ll pay interest on it and so will cost more in the long term.
You can use a mortgage calculator to see how much you could borrow.
Remember you’ll have to pass the lender’s strict eligibility criteria too, which will include affordability checks and looking at your credit file.
You may also need to provide documents such as utility bills, proof of benefits, your last three month’s payslips, passports and bank statements.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.
Plus, you can join our Sun Money Chats and Tips Facebook group to share your tips and stories