Buying a new home can be a lot more expensive than you may think, and there are usually a lot of hidden costs that can end up adding more than 10% to your total property bill. The costs that come with owning and running a house can often surprise former renters, meaning their budgets don’t quite match their financial needs.
If you don’t prepare for these hidden costs, you may find yourself in financial hardship for the first few years as property owners, so make sure you take them all into consideration:
Stamp Duty
Depending on the price of your property, stamp duty can end up adding thousands of pounds to the overall costs involved in buying a house. There are different brackets for stamp duty, and for properties under £125,000, stamp duty does not apply.
Surveys and Valuations
These are a necessity when buying a house, but can completely vary in price, ranging from just a couple of hundred pounds, up to more than a thousand pounds. This will depend on the value of your property, how old it is, and what type of survey you decide to have.
Mortgage Fees
Applying for a mortgage can be one of the trickiest parts of buying a house. There are lots of different processes involved, and with them come lots of different fees. Most mortgages will charge an arrangement fee, they may also charge an indemnity fee, and if you use a broker you will probably have to pay them a fee as well.
Removal Company
Once you have bought a house and have a completion date, you need to think about moving all your belongings in. The easiest way to do this is by hiring a removals company. Depending on how many things you have and how big your house is, this can cost anywhere from around £350 to many thousands of pounds.
Renovations
Some new homes will need work doing to them, but some homeowners just like to change things up in order to make their mark on their new house. The majority of places will need at least some decoration and some may also need a few repairs doing. This can all add up, and how much you spend will completely depend on what you want to do.
Council Tax
When a property is occupied, the residents will need to pay council tax – again this completely varies, depending on where you live and how big your house is. Small properties in low cost local authorities will only have to pay around £100 in council tax, but bigger houses in expensive councils will find themselves having to pay quite a bit more.
Insurance
Building and contents insurance can cost anywhere between a couple of hundred pounds and thousands of pounds a year, depending on a range of factors. These include what exactly you decide to insure, how much your home and belongings are worth, when your property was built, how secure your home is, and how much parts would cost to rebuild.
