The cost of moving
in - £3 billion
First-time buyers face an unexpectedly large bill when they cross the threshold
of their new home.
As if first-time buyers didn't have it hard enough already; after suffering
years of rising prices making it ever harder to get on the property ladder,
new research has revealed that they are forking out almost £3 billion
a year just to move into their first home.
This extra expense goes on items such as legal bills, tax, removals and basic
furnishings. It comes to about £6,000 per buyer and with half a million
first-time buyers joining the property market each year the total reaches
that scary £3 billion figure.
The amount they have to spend on these extras comes as a surprise to most
first-time buyers. In fact, almost nine in 10 admit they underestimate the
amount needed to cover costs on top of the actual property price.
The study, conducted for insurer Norwich Union, among almost 900 first-time
buyers revealed that while 94 per cent set a strict budget when embarking
on the hunt for their first home, a quarter end up going over budget –
with the average overspend being more than £10,000.
But this doesn't come as a surprise to the nation's estate agents. The insurer
spoke to 250 estate agents and eight out of 10 said that first timers always
underestimate the costs associated with buying a property.
And a quarter of all agents admit dealing with first time buyers is frustrating
and time consuming (the survey did not mention what the buyers thought of
estate agents).
Phil Spencer, expert house finder and presenter of Channel Four's Location,
Location, Location, says it's not unusual for new buyers to dwell on property
prices and neglect these hidden extras.
"It's easy for them to get fixated on property prices and overlook the cost
of moving in," he says. "And yet, as the survey shows, these costs are often
high and first-time buyers may end up having to borrow even more money on
top of their mortgage.
"It pays to be prepared and well organised and I always encourage new buyers
to consider every expense, investigate the various costs and set their budgets
accordingly.
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