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EXPOSED: The Real Costs of Buying a Home

Looking to buy your first home? Then like the majority of house-hunters, your biggest concern is probably whether or not you have the correct funds to go ahead.

Whilst you may have already saved for a deposit, have you considered the additional costs that can accumulate during the purchasing process? And if so, are you really saving enough to cover the costs that are about to come your way?

Let’s find out!

Here are just some of the costs you can prepare for when buying your first home…

Mortgage Costs

Securing a mortgage is undoubtedly the most important step in buying your new home. For expert advice and a competitive mortgage rate, many house-hunters will want to use the services of a professional mortgage advisor.

So how much will it cost you? Many mortgages come with an arrangement fee, ranging anywhere from a few hundred pounds to 1% of the property’s price. This can be paid upfront or added to your loan, which you will also have to pay interest on.

Survey Costs

Before you go ahead with the purchase of your new home, you’ll need to have a survey carried out. There are several options available to you at this stage. Some lenders’ will organise a valuation survey for you, confirming that the value of your home is correct. Whilst some lenders will include this for free as part of their mortgage offer, others may ask you to cover the cost. This will usually set you back in the range of £200-£400.

On the other hand, you can opt to get your own independent survey carried out – a buyer report or building survey being the two most popular options. Whilst a home buyer report can cost you up to £500.00, a building survey will often be £500-£1200, as this type of survey will provide you with a more in-depth analysis of your property.

Legal Costs

When buying a home, you’ll want to hire the expert services of a solicitor to handle the legal process. Solicitor (or conveyancing) fees can vary greatly and you can expect these fees to cover searches, registering with the Land Registry and the drawing up of legal contracts. Depending on whether your solicitor charges a flat fee or a percentage of the value of your property, you can expect to pay from £680 to £1500.

Insurance Costs

Many lenders require that by the time your property exchanges, you have building and contents insurance in place to cover your new home. Typically, you can buy the two for around £250 for the year. Buying home insurance is a non-negotiable step when becoming a home owner, so this is one expense you will not want to skip.

Removal Costs

Depending on the size of your current home and the amount you have to move, hiring the services of a professional removals company can cost you anything from a few hundred to a few thousand pounds. Alternatively, why not call in a favour from a few kind friends and get them to help you for free?

Stamp Duty Costs

Within 30 days of being legally entitled to your new home, you will be required to pay your stamp duty fee. The amount you pay will depend on the price of your property and can add as much as 7% to your overall purchasing costs. So take care to have a small lump sum set aside, ready to complete this final stage.

As you can see, the final costs of buying a home really can add up! Even amounting to as much as 10% of your final property bill. However, remember to budget for the above and your experience as a first-time buyer will be a much more enjoyable one.

Thinking of taking your first step onto the property ladder? Our experienced team can advise you on your investment and find you some of the best mortgage rates available, ensuring your journey as home owner gets off to the best possible start.

Want to know more? Call us today on 01702 619221 or contact us online.