First time buyers underestimate cost of moving into their home, survey finds
Almost three quarter of first time buyers in the UK underestimate the costs needed to buy a new home, with most only saving for a deposit, new research shows.
They also spend £1,680 more than expected on essential repairs to a first home and under budget by over £6,000, according to a survey by home insurer Aviva.
As a result, more than half were forced to wait an extra two years and eight months before finally having the cash to get on the property ladder and almost half confessed to coming close to giving up plans to buy their first home altogether.
First time buyers typically take nearly four years saving for a first home, banking an average £12,143 during that time. In reality though, the average total amount actually needed is closer to £18,624.
‘Scraping together the cash for the deposit alone can be a mammoth task, but that’s just the first hurdle. It’s the other essential costs such as solicitors’ fees and Stamp Duty which can be the sting in the tail, not forgetting any essential repairs which might be needed once the keys have been handed over,’ said Heather Smith, marketing director at Aviva.
Home owners spend an average £3,727 on essential repairs to their newly purchased home – typically forking out around £1,680 more than expected. One in five looking to buy their first home now would consider buying a house which needed significant DIY or repairs, just to get on the property ladder, the research also shows.
‘First time buyers face walking into a money pit if a first dream home turns out to be a nightmare. If the cash outlay needed to buy the house isn’t expensive enough, a hefty bill for unforeseen essential repairs is the last thing needed,’ explained Smith.
‘Anyone looking to buy a home should investigate every nook and cranny of the property before putting in an offer and must not be afraid of asking for several viewings,’ she added.
With three quarters admitting to not doing enough research into the total cost of buying a home, Aviva has launched a First Home section to its website which includes a step-by-step guide to buying a first home and a mortgage jargon buster.