Parents use Help to Buy to avoid childcare mortgage penalty

Harriet Reynolds 1 (002)
  • Situation: Home Owner
  • Location: Preston in Kent
  • Date purchased: Apr 19, 2017

With the average cost of full-time childcare in Britain estimated to be £11,300 a year and parents now said to spend more than a third of their income on nurseries and childminders*, it is no wonder that this is making it harder for families to move up the housing ladder as they struggle to secure the next size of mortgage needed.

One solution, which canny parents Harriet and Chris Reynolds found, was to use the Government’s Help to Buy equity loan scheme to make their next move. This allowed them to borrow an extra £103,600 interest-free for five years, and the couple plan to pay this off once their two-and-a-half-year-old twin boys, Benjamin and Noah, are at school and they will save on their current £280 weekly childcare fees. The young family has just purchased a five-bedroom detached house at Preston Grange, a David Wilson Homes development in the quintessential village of Preston in the Kent Downs Area of Outstanding Natural Beauty, near the cathedral city of Canterbury.

Harriet (31), who works in pensions, comments: “With two young boys, we were keen to move to an area with better schools and a house with more space for them to grow up in. We lived in a three-bedroom semi-detached property in Canterbury for six years and I loved being within a 20-minute walk of the city centre, but the older and more active the boys got, we decided that now was the time that we needed to move, plus we wanted to ensure we were living there in time to get the boys into the right schools.

Harriet continues: “We knew that we would have difficulty getting a much bigger mortgage, as so much of our income goes on the boys’ childcare each month and I now only work four days a week. Buying a new home and using the Help to Buy scheme was our best option to upsize into a property that would suit our family’s growing needs and last us until they flee the nest 20 years or so from now!

Help to Buy is the Government-backed homebuying equity loan scheme, which allows any buyer of a new home up to the value of £600,000 to receive a 20 per cent interest free equity loan. More commonly associated with first-time buyers as the scheme only requires a 5 per cent deposit, Help to Buy is also helping second and third-steppers like Harriet and Chris gain access to a mortgage rate more typically associated with a 75 per cent loan to value mortgage.

…2/ Harriet continues: “By the time we sold our existing property for £350,000, we had a substantial deposit, so this wasn’t our issue, but we needed to borrow extra, as the house was priced at £518,000.”

Preston Grange is an exclusive development of 70 executive homes surrounded by open countryside with village life right on its doorstep. Homes at Preston Grange have been designed with a real understanding of how modern families live, with features including large open-plan kitchen/dining areas, utility rooms, family snug rooms, double bedrooms (some with their own en-suite and dressing area), sizeable gardens, double garages, plus plenty of storage. When complete, the development will include a footpath to local meadow land and a new play area.

Chris (33), an IT Infrastructure Engineer, comments: “The house is huge and the boys have their own play room, a big garden to run around in, as well as equal size bedrooms, which will save on any arguments in the future! I had always been keen to move out into the countryside as you can get so much more house for your money in comparison with Canterbury itself. We knew Preston a little already as Harriet’s parents live in nearby Littlebourne and were particularly keen on the village, as there are several good primary schools nearby, and we would be happy with the boys going to any of them.”

Natalie Perry, Head of Sales & Marketing for David Wilson Homes Kent comments: “With parents often penalised by their childcare costs when they apply for a mortgage, it is no wonder that families are struggling to move into the size of property they need to accommodate their growing family. Often thought of just for first-time buyers, Help to Buy allows any buyer of a new home up to the value of £600,000 to do so with a 20 per cent interest free loan. This is great news for buyers like Harriet and Chris, who have been able to trade up to exactly the house that they want in an area which they know will be right for their family for many years to come.”

Preston has its own pub, store, family butcher's, primary school and plant nursery, together with a farm shop and riding school. The neighbouring village of Wingham caters further for everyday needs and has a wider selection of local shops ranging from a post office and greengrocers, to more specialist shops selling guitars to antiques. Wingham also has its own primary school, several farm shops selling local produce, pubs and cafes, as well as a dentist and doctor’s surgery.

Meanwhile, historic Canterbury is less than nine miles away, offering an excellent range of shopping, cultural, sporting and recreational facilities, together with high speed rail services to London, providing a travel time to London St Pancras from Canterbury of less than an hour. Preston is located on the edge of the North Downs Area of Outstanding Natural Beauty and the surrounding countryside offers a wealth of walks, rides and cycle routes.

A selection of four and five bedroom houses are currently available at Preston Grange with prices starting from £482,995. Help to Buy is available on all homes at Preston Grange priced under £600,000. For further information, please contact the sales team on 0844 854 9937 or visit www.dwh.co.uk.

ENDS

For more information about David Wilson Homes in Kent, please contact kathryn@building-relations.co.uk or call 07397 383227.

*Organisation for Economic Co-operation and Development (OECD)

 

 

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With the average cost of full-time childcare in Britain estimated to be £11,300 a year and parents now said to spend more than a third of their income on nurseries and childminders*, it is no wonder that this is making it harder for families to move up the housing ladder as they struggle to secure the next size of mortgage needed.