If you’re looking to get on the property ladder for the first time, then it can be a really exciting time. Having somewhere of your own, an investment, is a great achievement and something that could help you get to financial freedom. But if you’ve not bought before, then you might be unsure of how much it costs to actually move house. As well as a deposit, you will also need money for other fees that you might not have thought about before. So when looking at what you want to borrow from the bank, it might be more than you were originally planning on.
So what are the extra or ‘hidden’ costs when it comes to buying a house? First of all, even arranging a mortgage can cost money. You could be looking at an extra £2500 just to arrange your mortgage, depending on which lender you choose and what deposit you have. A booking fee can easily be at least £100, with a mortgage valuation fee being around £150 too. Then the larger sum that you need to think about is an arrangement fee that could be as much as £2000! It is best financially if you’re able to pay these fees up front. But what it will mean is that you need to have even more saved than you thought. Saving £20k for a deposit? Then you’ll actually need to have over £22k saved after all.
There are some major up front costs when it comes to moving house, depending on the price of the house that you have chosen to buy. At the moment, stamp duty is a government imposed tax on homes over £125,000. If you’re buying a small flat in a cheaper area of the country, then this may not be a consideration for you. But if you are buying a larger home, then it will depend on the cost of the house that you’re looking to buy. But it can be a pretty hefty amount. While it isn’t the end of the world, and you can work out what you’d pay using a stamp duty calculator, you need to make sure that you’re able to afford that added onto what you want to borrow for a mortgage. Even if you’re buying with cash, you’ll need more than you think when you factor in stamp duty.
If you have chosen a home and are seriously considering about making an offer, or have made an offer, then getting a surveyor in is important. They can let you know if there are any warning signs that could end up costing you or if there are any things that are currently unsafe in the property. The price can vary, depending on what you’re looking for, but a site like Bevans Chartered Surveyors could give you an indication. Again, it is fine when you know about it and factor it into your costs. So just bear that in mind.
As you can see there are plenty of extras when it comes to buying a house. But a home can be a great investment, so as long as you can afford it, don’t let the extras put you off.