What are the hidden costs of buying a house?

Moving into a new home is an exciting time, but it can also be an expensive one if you don’t budget for it properly.
Just like any major life event, getting your finances in order can make the whole process run much more smoothly and without any hiccups. Preparation really is key. With this in mind, here are some hidden costs to look out for when buying a home (particularly if you’re a first-time buyer) that you’ll want to make sure you budget for.

Upfront costs when buying a home

Moving costs

You’ve budgeted for your new furniture, decor and that new bathroom to be fitted, but what about moving costs? The costs of hiring a removal company, along with removal insurance, boxes and bubble wrap can soon add up! Set aside enough money so that your belongings can be transferred safely and, this way, you won’t have to fork out for any costly replacements.

Legal fees

There are a few legal matters that will need to be carried out when buying your house, including transferring title deeds and property-specific checks. Although these might seem costly at first, they’re incredibly important to the house buying process so it’s vital that they are carried out by a specialist first-time buyer solicitor, such as ET Law .

Mortgage costs

There are a couple of costs associated with getting a mortgage, aside from the monthly mortgage payments you’ll be required to pay. Firstly, you’ll need to budget for valuation fees when applying for your mortgage. This valuation fee ranges from lender to lender, so it’s best to do some research to get an idea beforehand. You’ll also need to pay the mortgage lender a deposit – this is often around 5% of your mortgage price and is, unfortunately, essential when taking out a mortgage.

Stamp duty

If you’re a first-time buyer, you don’t have to worry about stamp duty if your property is under £500,000 and all buyers are first-time buyers. However, if this isn’t your first home, you’ll be required to pay a Stamp Duty Land Tax (SDLT) if your property costs more than £125,000 (in England and Northern Ireland). You’ll find a full breakdown on the government’s SDLT page so that you can accurately budget for any stamp duty costs.

What about the ongoing costs?

As a savvy saver, there’s no doubt you’ll want to budget for the unexpected. Here are some ongoing costs to be aware of.

Repairs and renovations

Depending on the condition of your new home, you might discover a few things further down the line. However, your surveyor should also be able to point out any serious issues with your home before allowing you to purchase, so these costs shouldn’t be too excessive. You might also want to budget for minor renovation costs, such as painting the walls or replacing carpet, as this can soon add up, too.

Insurance costs

Don’t forget your home insurance! It’s important to protect your property from any damage that could occur, such as a fire or flood damage. Your insurance costs might seem a little unnecessary at first, but you’ll be appreciative of them should anything happen to your home.

Do you have any tips for savvy first-time buyers in the UK? Let us know in the comments below!

This is a collaborative post.


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Lynn Beattie

Aka Mrs MummyPenny

Personal Finance Expert

I write about personal finance made simple, lifestyle choices that will save you time and money, as well as products and services that offer great value.

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