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Protect your First Time Buyer Status

Why should you protect your first time buyer status?

A Guide for First Time Buyers

I’m a First Time Buyer… I think?

We are regularly contacted by people who believe that they are First Time Buyers, only to find out two or three questions later, that they are not. As odd as it sounds, it is possible to lose your First Time Buyer status quite inadvertently.

As you would expect, the phrase First Time Buyer refers to a person who is purchasing a residential property for the first time.

Depending on the benefit or relief that is being sought the term First Time Buyer may be interpreted slightly differently, but the spirit of the definition always remains – that someone should never have owned an interest in a residential property in Northern Ireland or anywhere else in the world.

Sounds simple enough, yet there are some quite common scenarios that can result in the loss of your First Time Buyer status without you ever considering that you have owned a home.

How to inadvertently lose your First Time Buyer status

A common misunderstanding among purchasers is that because they are buying their first home that they intend to live in, they are therefore a First Time Buyer. 

However, for the large part the focus will be on whether you have been named as a registered owner of any property, regardless of whether or not you lived in it. As such, you can lose your First Time Buyer status if:

  • Your parents decided to transfer the property into the names of their children, so that you and your siblings each became registered owners, even though your parents carried on living at the property as the main or only residents.
  • You have ever invested in a Buy to Let property with family or friends, even if you never lived in it and have since sold the property.
  • You have been named as a registered owner to assist a friend or family member to reach affordability on a house they were purchasing, even though you never lived at the property or profited in anyway, or even made any financial contribution to it.
  • You have ever inherited a property and it was assented into your name, even if you never lived in it and even if it has since been sold.
  • In the case of a joint purchase where only one of you is a First Time Buyer. In order to avail of the First Time Buyer Stamp Duty Land Tax exemption all purchasers must be First Time Buyers. If your co-purchaser is not, you lose your First Time Buyer status for Stamp Duty purposes.

The Benefits of being a First Time Buyer include;

  • You’ll pay less stamp duty tax
  • You can elevate your savings
  • You have a significant advantage over other people who want to make an offer on a property you like. You do not currently have a property to sell in order to buy a new one, which makes the process faster and easier, as a result you may be a preferred buyer
  • There is support available from government via various support schemes; which we will cover in greater detail for Northern Irish Buyers, in our next First Time Buyers Guide feature.

How to Protect your First Time Buyer status

You should consider your First Time Buyer status as something to protect. 

If you are approached about joining in on a purchase of a property to help someone with affordability, or because your parents want to make plans for the future, be mindful of the financial consequences of becoming an owner of a property ahead of completing the purchase of your first home. 

Secondly, be sure to take advantage of the financial incentives and benefits available to you. These will change and develop over time, so stay aware of the perks of your First Time Buyer status.

Ready to take the next step?

If you are about to make an offer on a property and require a solicitor to handle the legal process, get in touch with our expert Residential Property team; call us on 0800 840 9290 or Make an Enquiry online.

Get in touch

To find out more about how we can help you with your query, please contact us.