The True Cost of Buying a Home in the UK
A Comprehensive Guide
Introduction:
Buying a home is one of the most significant financial decisions most people will ever make. While the listing price of a property might be the figure that first grabs your attention, it’s only the beginning of the financial journey. The true cost of buying a home in the UK includes a wide range of fees, taxes, and other expenses that can quickly add up. To avoid any costly surprises, it’s crucial to understand all the associated costs involved in purchasing a home.
In this article, we’ll break down the various costs – from deposits to legal fees – so you can budget more accurately and move into your new home with confidence.
The Deposit
Perhaps the most obvious cost involved in buying a home is the deposit. Most mortgage lenders in the UK require a minimum deposit of 5% of the property’s value. However, for better mortgage rates, putting down 10% to 20% (or more) is advised.
Example:
For a £250,000 home, a 10% deposit would be £25,000.
Some buyers may qualify for government schemes like Help to Buy (now only available in Wales), or Lifetime ISAs, which can offer a government bonus to help boost your deposit savings.
Mortgage Fees
Mortgage lenders often charge various fees when setting up your loan. Common mortgage-related costs include:
Arrangement Fee: Often between £0 and £2,000. Some lenders allow you to add this to your mortgage, but doing so will increase your total repayment.
Booking Fee: Typically around £100–£200.
Valuation Fee: Mortgage providers usually require a property valuation to assess if the home is worth the loan amount. Costs range from £150 to £1,500 depending on the property’s value.
Tip: Some mortgages are advertised as “fee-free,” but these often have higher interest rates. Always compare the overall cost.
Stamp Duty Land Tax (SDLT)
Stamp Duty is a government tax on property purchases in England and Northern Ireland. The amount depends on the property price and whether you’re a first-time buyer.
As of 2025, the standard rates are:
0% on the first £250,000
5% on the portion between £250,001 and £925,000
10% on £925,001 to £1.5 million
12% above £1.5 million
First-time buyers benefit from a relief on homes up to £425,000.
In Scotland, this tax is called Land and Buildings Transaction Tax (LBTT). In Wales, it’s the Land Transaction Tax (LTT). Rates and thresholds vary slightly.
Legal Fees (Conveyancing)
To ensure the legal transfer of ownership, you’ll need a solicitor or licensed conveyancer. Conveyancing fees typically range from £800 to £1,500, depending on the complexity of the transaction and whether the property is leasehold or freehold.
Your solicitor will:
Carry out property searches (e.g., local authority searches)
Draft and check contracts
Handle the transfer of funds
Register the property with the Land Registry
Search fees are often included in the solicitor’s quote but can range from £250 to £400.
Survey Costs
Before finalising the purchase, it’s wise to get a survey done to assess the condition of the property. There are several types of surveys:
Condition Report – £250–£400 (basic overview)
Homebuyer’s Report – £400–£1,000 (more detailed)
Building Survey – £600–£1,500+ (for older or unusual properties)
A good survey can uncover hidden issues and potentially save you thousands in future repair costs.
Removal Costs
Unless you plan to move everything yourself, you’ll likely need to hire a removal company. Prices vary based on the distance and volume of goods, but a rough guide is:
£300–£600 for a local move
£1,000+ for longer distances or larger homes
If you need help with packing, remember that Hartgrove Bros offers a full or partial packing service!
Home Insurance
Mortgage lenders usually require you to have buildings insurance in place from the date of exchange. This covers structural damage to the property. Contents insurance is optional but recommended to protect your belongings.
Buildings insurance: £150–£300 annually
Contents insurance: £50–£150 annually
Many providers offer bundled deals for both.
Broker Fees
If you use a mortgage broker, they may charge a fee for their services – typically around £300–£500, although some brokers are free to the buyer and instead earn commission from lenders.
On-going Costs After Purchase
Although not directly part of the buying process, it’s important to budget for ongoing costs such as:
Council Tax: Varies by local authority and property band; can range from £1,000 to over £3,000 per year.
Utility Bills: Gas, electric, water – usually £100–£300+ per month depending on usage.
Service Charges & Ground Rent: If buying a leasehold property, be aware of additional fees payable to the freeholder or management company.
Maintenance and Repairs: Especially for older homes, it’s wise to set aside an emergency fund for unexpected costs.
Furniture and Furnishings
Finally, don’t forget the cost of turning your house into a home. Depending on whether the property is furnished, you might need to purchase:
Beds, sofas, and tables
White goods (fridge, washing machine, etc.)
Curtains, blinds, and light fittings
This can run from a few hundred to several thousand pounds depending on your preferences and budget.
Final Thoughts
The process of buying a home in the UK involves more than just saving for a deposit. When all is said and done, additional costs can add £5,000 to £15,000+ to the purchase, depending on the value of the property and services chosen.
Top Tips:
Use online calculators to estimate total buying costs
Get quotes from multiple service providers (solicitors, surveyors, movers)
Don’t overstretch your finances – leave room for unexpected expenses
Being fully informed about these costs will help you budget effectively and reduce stress throughout the buying journey. Whether you’re a first-time buyer or moving up the ladder, understanding the full financial picture ensures you’re making a smart and sustainable decision.