Buy residential direct from the developer

One of the first decisions young people who start working have to make is where to live.

And most of them will realise their only immediate option is to rent accommodation because it is unlikely they will be able to afford property of their own.

"But there are ways in which young people can work towards this goal and put themselves on the path to future prosperity," says Berry Everitt, managing director of the Chas Everitt International property group.

"In the first instance they should approach a bank or mortgage originator to find out what size bond they qualify for based on salary and financial commitments such as clothes accounts or car repayments. In most cases the news is unlikely to be encouraging, but it will give them an idea of what price range they should target for a first property.

"They should then take steps to improve their credit rating by reducing financial commitments and making sure that they maintain a good credit record. A savings account into which monthly deposits are made will not only help to accumulate a down payment on a property but also demonstrate financial discipline."

Everitt says realism is another necessary ingredient. "It is not a good idea to delay buying just because you cannot afford a luxury home at first. It is a better option by far to buy a modest property and build up some equity - in other words, wait for the value to increase - before selling again and using some of the gains on a property closer to your dreams.

"And if the only property you can afford is far away from where you need to live because of where you work, it is still an option. Such property can be let to tenants, who will help pay off the bond, while you continue renting yourself in the interim.

"Once the value of the purchased property has grown sufficiently, it can be resold and the proceeds used to buy a home for your own use."

Courtesy of Property24