The costs of buying a house

With so many upfront costs involved, buying a home is likely to be one of your biggest expenses in life. Making sure you're aware of the different costs will help you budget and save up enough.

The deposit

In short, the more you put down the better, for two reasons.

1. It reduces the amount you need to borrow (and boosts your buying power)
2. It opens up more competitive mortgages to you.

Lenders reserve their most competitive mortgages for borrowers with bigger deposits. Those with a relatively small deposit will usually pay a higher rate to reflect the greater risk the lender is taking.

Stamp Duty

Stamp Duty Land Tax is paid to the government on the purchase of a property.

As of 1 April 2025 the UK Government announced a number of changes to Stamp Duty Land Tax. Check your Stamp Duty Rate on the government website.

First time buyers pay no Stamp Duty on purchases up to £300,000, and 5% on the portion from £300,001 to £500,000. If the price is over £500,000, first time buyers cannot claim this relief.

You and anyone else you’re buying with must be first-time buyers to benefit.

Check your Stamp Duty Rate on the government website

Mortgage product fees

The majority of Lenders offer mortgage products with and without fees. This fee is sometimes called an arrangement fee or completion fee and can be either a flat fee like £999, or a percentage of the amount borrowed, like 1%.

This fee is usually paid at application stage, but you may also be able to add it onto the mortgage at completion. If you choose the latter, keep in mind that you will be charged interest on the fee amount over the full term of your mortgage.

You don't have to choose a product that incurs a fee, however, you may find that interest rates on these products may be lower than products without a fee. It’s important to look at the total cost over the deal period to understand the overall costs and compare deals.

Valuation or property survey?

Your lender needs a valuation of the property because that’s what its loan (the mortgage) is secured against. It’s usually the buyer who pays for it, although in some cases the lender will cover the valuation cost.

As well as the valuation, you might choose to pay for a property survey. This notes any problems that the surveyor may find during the inspection.

Your survey might make you rethink buying the property, or it could allow you to negotiate the price down. It's more expensive than a valuation, but it can be money well spent.

The next level up from a valuation is a HomeBuyer Report and more expensive still is a Building Survey. The cost of each varies depending on the type and price of the property.

Legal fees

Buying a home is a legal process and most people use a solicitor or conveyancer. Legal fees to buy a house are typically £700 to £1,500. But if you're selling as well as buying, you will pay more.

Finding a good solicitor is really important. Make sure you can easily contact them if you need to. You could ask friends, family or your estate agent for a recommendation.

Some lenders also have a criteria that the solicitor must meet in order for you to use them such as being members of The Law Society. It is always best to check with the lender that the solicitor meets their criteria before instructing a solicitor and incurring any fees.

Insurance

Your home is likely your biggest asset. So, it’s smart to get insurance. This protects your property, your belongings, and can help if you can’t pay your mortgage.

Home insurance

While buildings insurance is compulsory with a mortgage, most people also insure their contents. These often come as a joint policy called building and contents cover or home insurance.

Shop around for an insurance deal. You don’t need to choose the cover on offer from your lender.

Learn more about the insurance we offer

Life insurance cover

Life insurance is recommended if you have dependants. It helps them pay off the mortgage if you die and can provide extra money for expenses. A basic policy that aligns with your mortgage is usually affordable. You can also opt for more comprehensive coverage.

Other insurances

Critical illness cover pays out a lump sum if you can’t work due to becoming ill with one of a list of specified conditions. You decide the sum you want to insure, for example £50,000, and you pay a monthly premium.

If you get one of the conditions listed on your policy, the insurer pays out the amount you insured as a tax-free lump sum. This can help you cover the mortgage and other expenses while you recover.

Income protection pays you a set monthly amount if you're unable to work because of illness or an accident. It’s a long-term policy that pays you until you can return to work or reach an agreed retirement date.

Income protection can be expensive, but it protects your earnings and pays out over the long term if you need to claim.

Removals fees

You'll need a large van to help you move into your new home, unless you move out of fully furnished accommodation or only have a few bits of furniture. Hire one yourself or pay a professional removals firm to do all the heavy lifting for you. They'll even pack for you if you pay them to.

Make sure the company you use is insured and ask family or friends for a recommendation. However, even if you get quotes, don’t make a firm booking until you exchange contracts.

Estate agent fees

If you're buying a property, you don’t pay anything to the estate agent. But unless you are selling your house privately, you'll pay an estate agent to sell your home.

You'll pay either a flat fee, like £999, or a percentage of the sale price, like 1%.

Bank transfer fees

When you're moving a large sum of money, such as for a house deposit, it’s usually done as a CHAPS payment rather than via your online banking app.

There’s a fee of around £20 to £50 depending on your bank.

Leasehold costs

A leasehold property is where you buy the property but not the land it sits on. It’s common with blocks of flats, although you can get leasehold houses too.

This means you own your home, but you have a ‘landlord’ who charges a ground rent each year. You might also have a management company that maintains shared areas, like lifts or stairwells. They may charge a management fee too.

Maintenance and repairs

If you need to do some work on the property after you buy it, get a builder to quote first.

It'll give you an idea of the size of the job, and it will help you decide how much to set aside to cover the work. If you're planning substantial work, remember to check if you need planning permission.

White goods and furniture

If you are buying your first home, you most likely need to furnish it. White goods, such as fridges and washing machines, can be expensive, as can new furniture.

Remember to set aside some of your buying budget for these extra costs if you need to.

If you can’t pay your mortgage

If you are worried that you won’t be able to pay your mortgage, get in touch with your lender. They will work with you to come up with a repayment plan based on your circumstances.

Find out more

For more information on buying a house, download our First time buyers guide.

You can also find out more about our products on our mortgage page.