Before you can actually buy a property, you need to work out whether you can afford to do so. Affordability can be a big problem, most notably for first time buyers. Most people need a mortgage to buy a property - a loan from a bank or building society. Lenders calculate the maximum you can borrow based on how much you earn. But what the lender is prepared to lend you and what you should borrow are two different things. Mortgage lenders have relaxed their borrowing criteria over the past couple of decades, with much bigger home loans now available. But that doesn't mean you should take on the biggest mortgage you can. Keep in mind that you have to repay it. Even if you can cope initially, you may struggle if you lose your job, for example. If you are overstretched, even a small change in circumstances can prove catastrophic. Even if you can't afford to buy on your own, there may be other ways of realizing your goal by buying with friends, a sibling, or persuading your parents to help out.

Multiplying your income Typically, you can borrow three or three and a half times your annual income if you buy on your own, or two and a half times your joint income if you hook up with someone else. So if you earn £30,000, you should be able to get a mortgage for £90,000 to £105,000, depending on the lender, if you buy on your own. If you buy with your spouse, who earns the same as you, you could borrow up to £150,000. Unfortunately, these income multiples won't get you very far. The average price of a property in the UK in March 2007 was £194,362 according to the Halifax (though averages do vary from one source to another), and there's no sign of a reversal in the upward trend at the time of writing. Unless you have a large deposit - perhaps an inheritance from a relative - you won't be able to bridge the ever-widening gap between property prices and how much you can raise. In an effort to help borrowers make up the shortfall, some lenders have increased their income multiple to four, five, or even six times income. But think carefully before taking on such a big loan if it is offered to you. Make sure you are happy with the repayments and can cope if interest rates rise. Don't overstretch yourself.

Coping without a deposit With more than 7,000 mortgages available from over 100 lenders, there's bound to be one out there that suits you - even if you haven't got a big deposit or don't earn hundreds of thousands of pounds every year. There are several 100 per cent mortgages available and some lenders even let you borrow up to 125 per cent of the value of the property. So even if you haven't got a deposit, it doesn't necessarily mean you can't get a mortgage. Realistically, it could take you several years to save up a 5 or 10 per cent deposit, depending on how good a saver you are and other demands on your wallet. In such circumstances, it could make sense to borrow a greater proportion of the purchase price now, rather than put off buying for a few years while you save up several thousand pounds for a deposit.

If you delay your purchase in a rising property market, you could find prices increasing to such an extent that you're priced out of the market yet again. The problem with not having a deposit (or having a very small one) is that you won't get the cheapest mortgage rate. You qualify for the best deals if you have a sizeable deposit, because lenders regard you as being lower risk than someone without a deposit. A number of lenders also charge a mortgage indemnity guarantee (MIG) - a one-off insurance premium typically charged if you borrow more than 90 or 95 per cent of the value of the property. Another response to rising prices is the introduction of loans spread over longer than the traditional 25 years. A quarter of lenders offer mortgages running 40 years or more. Such arrangements reduce monthly payments, but be warned - you could be still be paying off your home loan after you have stopped working.