First time buyers encouraged to exercise caution

First time buyers in the Black Country should still exercise caution before leaping onto the property ladder, despite the Government's latest attempt to breathe new life into the housing market.

That's the message from leading Midlands solicitors Higgs & Sons, who are wary of today's (TUE) Government announcement to increase the stamp duty threshold to £175,000 for 12 months and offer free loans to lower income households.

Philip Barnsley, a Higgs & Sons partner and member of Resolution, said that whilst the measures may offer relief to some first time buyers, a number of key issues must be still be considered.

He said: "An increasing number of first time buyers are having to rely on help from parents and relatives, or use other savings and investments to assist with that first purchase.

"Whenever there is inequality in contributions to the purchase price, the parties should be advised fully upon the implications and clearly define the ownership of that property. 

"The parties should enter into a Declaration of Trust and a Cohabitation Agreement in order to avoid the need for costly and emotional proceedings if the relationship ends, and the possibility of that inequality in contribution being ignored upon the sale or transfer of the property."

There are currently an estimated 2.2 million cohabiting couples in the UK and only around 15 per cent of these who own property jointly have a written agreement about their share of the ownership.

The Government announced in March 2008 that it was delaying the implementation of new recommendations governing cohabiting couples.

Any first time buyers seeking help and advice about the housing market can call Higgs & Sons on 01384 342100.

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