Buying a house is a time of great excitement as you plan the ways you want to decorate, the memories you’ll make, and the endless possibilities that lie ahead. But like any investment, there are certain costs to consider that could affect your house-hunting budget. Avoid missing out on your dream home by ensuring you have enough money in the pot by knowing about the hidden costs of buying your new home.
1. Deposit
While a good rule of thumb is to have at least a 5% deposit to put towards the cost of your new home, it’s worth noting that the bigger the deposit you can pay, the more likely you are to be given a mortgage, and the lower your interest rate is likely to be.
You can start making small savings towards your deposit without making major changes to your spending. For example, ditching that latte-a-day habit you’ve picked up could easily save you hundreds over the course of a year. Switching from branded goods in the supermarket to own brand will instantly help you save on your weekly shop. And if you’re still not sure where to start, why not download an app that helps you save by automatically rounding up purchases?
2. Surveyor’s fees
While having a survey isn’t a legal requirement when you purchase a property, it could highlight any major structural problems which could mean costly repairs in the long run. Surveys range from a basic homebuyers’ to a full structural and can cost from between £250 to £600 plus.
It’s also worth noting that if you have a mortgage advisor, some of their mortgages come with a survey included. While you will have to pay for their invaluable advice, the long-term returns on your investment are undeniable.
3. Legal fees
Unless you’re confident in conveyancing your own property, you’ll need assistance from a conveyancer. While legal fees typically cost around £850 – £1,500, they will save you time and stress in the long run.
Alongside the legal fees, you will also have to pay for local searches and disbursements which can cost between £250 – £300.
It’s worth checking to see if your legal fees are fixed fees, otherwise you could be hit with a higher bill if the conveyancing process is more complicated than the average purchase. Many conveyancing firms also charge for their service even if the sale doesn’t go through. And with as many as one in four house sales falling through you could be landed with hefty legal fees and no new home.