Preparing to take your first step onto the property ladder can be an exciting time, but it’s pretty scary too. You’ll need to keep your wits about you when you buy a house if you want to avoid getting into a financial mess. What you don’t realise when you first take that big step is that there are a whole host of other expenses to cover. There are so many hidden costs of buying a home.
Lots of first-time property purchasers fall into the trap of stretching their budgets right to the limit to cover the asking price of a home without considering the additional upfront costs they will need to shell out for. These expenses can include structural surveys, legal fees, taxes, mortgage fees and removal costs. When you’re calculating how much you can afford to spend on your house or apartment, make sure you take these extras into account.
The ongoing expenses connected with owning a property can also trip unsuspecting purchasers up. Bear in mind, it’s not just your mortgage repayments you’ll face once you move into your new home. You’ll also have to pay home insurance. Contents cover is optional but recommended, while buildings insurance will be considered mandatory by your mortgage lender. This financial protection covers your home against floods, fires, subsidence and other disasters.
Then there are property taxes to pay, along with bills for water, gas, electricity, internet, TV and more. Before you commit to purchasing a property, try to estimate how much your taxes and bills would total each month. This will help you to determine whether or not you can afford to run the place.
As well as these regular expenses, it’s important to factor in unpredictable, one-off costs and try to leave some leeway in your budget for them. For example, you might find you have to make home repairs when you first move into your property and, over time, you’re bound to need to replace appliances, furnishings and fixtures. A sudden boiler breakdown or roofing repair could blow a hole in your household finances if you don’t have some savings in place.
There’s no need to let additional expenses like these put you off taking your first steps onto the property ladder, but do make sure you factor them in when you’re choosing which home to buy. By thinking about these costs now, you can avoid nasty surprises further down the line.