New research* shows that over 40% of first time buyers don’t take into account all the costs involved in buying a property and one in four buyers were shocked by the cost of bank transfers, searches and mortgage set up costs. (*Source: Pegasus Personal Finance, April 2016).
The research also found that 24.3% of first time buyers weren’t aware of land registry fees, 16.7% were unaware of stamp duty and 14.7% were not knowledgeable on solicitors’ fees. One in 10 admitted a lack of knowledge on interest rates and some 13.5% of home owners, assumed to be those with variable rate mortgages, admitted they haven’t prepared for an increase in interest rates, should they unexpectedly climb from a seven year low of 0.5%.
On top of this, one in five buyers did not account for an increase in utility bills as a result of moving to a larger property, while the same number were surprised to see their car insurance costs increase. What’s more, 24.6% underestimated removal charges, while 13.9% viewed furniture and decor as a surprise expense.
According to Balgores Property Group, leading estate agents in Essex, first time buyers need to do their research and work out all the costs before they buy their first home. Martin Gibbon a Fellow of the National Association of Estate Agents and Group Director of Balgores Property Group commented: “Unforeseen fees and costs can amount to £1,850 according to recent data from the Money Advice Service. We have seen many first time buyers who have not budgeted for stamp duty and some of the other smaller costs like mortgage application fees and legal expenses.
“It can be a nightmare trying to work out all the costs when you are buying a property for the first time, but it so important that first time time buyers crunch the numbers, or they could lose the house of their dreams. Demand for property in Essex is soaring and so first time buyers need to be ready to buy, with mortgage approval and legals sorted.
“We can help first time buyers if they come in and see us. We can give them a complete breakdown of all the moving costs, together with advice on mortgages and protection, as well as information on the running costs of the home they're interested in. We have a range of mortgage specialists that will find the best first time buyer mortgages and will be able to guide buyers through all the costs incurred when applying for a home loan.”
For further information, contact your local office or visit www.balgoresproperty.co.uk
