What is the Cost of Buying a House in 2022?
The average cost of buying a house in the UK is £35,570, based on a home costing £277,000 - the current UK average house price.
This varies depending on the location and size of the home. You will also need to factor in the conveyancer you choose and the type of survey you need. Other costs when buying a house include Stamp Duty, removal costs, insurance and property maintenance.
These are the average costs of buying a house, including the upfront costs and extra costs you may need to plan for.
Be aware that these will vary depending on the location, size and value of the house and the type of survey you need. Also, keep in mind that the buying process may differ in Scotland.
Upfront Costs:
| Service | Cost |
|---|---|
Mortgage Deposit | Usually 10% of the house price |
Mortgage Fees | From £274 |
Mortgage Broker | Average £500-£600 |
Surveying | From £250 |
Conveyancing | From £860 |
Stamp Duty | £3,850 |
Extra Costs:
| Service | Cost |
|---|---|
Removal Costs | £264 - £1,680 |
| Storage | £23.94 per square foot (UK average) |
Mail Redirection | From £33.99 |
| Insurance | £307 per year* |
| Property Maintenance | £3,579 per year* |
1. Mortgage Deposit
A deposit is an amount you initially put towards the cost of the property when taking out a mortgage. Mortgage lenders request a minimum of 5% to 20% of the purchase price of the home as a deposit. Typically buyers will put down 10%.
A 10% deposit for the UK average property price, which is currently £277,000, is £27,700.
The bigger the deposit you can afford, the better your mortgage deal and the lower the interest rate will be. For those struggling to save for a deposit, there is help available. The government introduced the Lifetime ISA and Help to Buy Scheme to help budding homebuyers get their foot on the property ladder.
To read more about saving for a deposit and our top tips for reaching your goal read: How to Save for a Mortgage Deposit
2. Mortgage Fees
When applying for a mortgage, you will need to save for more than just the deposit. Getting a mortgage will come with fees, which will vary from lender to lender. Below is a table of fees you may need to pay:
| Fee | What is it? | Cost |
|---|---|---|
Arrangement Fee | This is paid to your lender for setting up the mortgage. You can choose to add it to your mortgage payments or pay upfront. This can vary based on the lender and type of mortgage. | £0 - £2,000 |
Booking Fee | A booking fee is charged when you apply for a mortgage. This is often non-refundable, even if you don’t end up getting the mortgage. Some mortgage providers may include it in the arrangement fee | £99 - £250 |
Valuation Fee | A valuation fee is paid to your lender to carry out a mortgage valuation on the property. It reassures lenders that the home is worth the amount they are lending. | £150-£1,500 depending on the price of the property |
Telephonic Transfer Fee | A telegraphic transfer fee is what your mortgage lender will charge you for sending the money to your solicitor. | £25-£50 |
3. Mortgage Broker
A mortgage broker can advise buyers on what mortgage would be right for them and which lender to choose. Although this is not required to buy a home, mortgage brokers may have access to mortgage deals that individuals won't. On average the cost of a mortgage broker is around £500-600 (fixed fee). Any additional costs are added after completion
To find out more read: Do You Need a Mortgage Broker?
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4. Surveying Fees
A survey will give you a better idea of the condition of the property you are looking to buy. It can also advise you on any maintenance or repairs it requires.
Below is a breakdown of the various surveys and costs, including which survey is best for the type of house you are buying:
| Survey Type | Cost |
|---|---|
RICS Home Survey Level 1 | From £250 |
RICS Home Survey Level 2 | From £350 |
RICS Home Survey Level 3 | From £500 |
Snagging Survey | £300-£600 |
1. RICS Home Survey Level 1
The most basic report, the RICS Home Condition Survey is available from around £250.
To find out more about a Level 1 Survey see: What is a Condition Report? (Level 1 Survey)
2. RICS Home Survey Level 2
The RICS Home Survey Level 2 starts from around £350 for properties worth up to £99,000. For a house priced between £100,000 and £249,000, the average cost is around £500.
This survey will provide an overview of the home and highlight any major issues.
The survey will look for any rot, damp and review the condition of ceilings, walls, floors and joinery.
To read more about the Level 2 Survey visit: What is a Homebuyer Survey? (Level 2 Survey)
3. RICS Home Survey Level 3
The cost of a RICS Home Survey Level 3 typically starts at £500 - £600. This is the most comprehensive survey. It is recommended for older or unusual properties or those in poor condition.
The Level 3 survey will detail any faults and work required on the home. This could potentially save you money by highlighting any issues before they develop. It can also provide you with the necessary evidence to negotiate the price of the property.
For more information about Level 3 Surveys go to: What is a Building Survey? (Level 3 Survey)
4. New-Build Snagging Survey
Snagging surveys are an independent inspection to look for issues with new-build homes, costing between £300 - £600. Surveyors usually report findings to the developer so they can address any issues.
For more on Snagging see: How Snagging Lists Can Help New Property Owners
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5. Solicitor Fees
When buying a house you will need a conveyancer to handle the legal side of the transaction. The average solicitor fees for buying a house are £1,320 for a freehold property, including VAT at 20%. Keep in mind that these fees will depend on the size, location, value of the house and the conveyancer you use.
Be aware that conveyancing fees for a leasehold property will be higher, costing £1,490 on average.
Disbursements
In addition to your legal costs, you'll have to pay conveyancing disbursements. These are fees to third parties that your conveyancer will pay on your behalf. These include the cost of an environmental search and local authority search
Below we've included a table of costs breaking down various conveyancing fees:
| Fee | Average cost |
|---|---|
Conveyancing Search Pack | £290 |
Anti-money Laundering Checks | £5 |
Bank Transfer Fee | £40 |
Transfer Ownership with Land Registry | £438 |
6. Stamp Duty
Stamp Duty for the UK average property price, which is currently £277,000, is £3,850.
Stamp Duty Land Tax is paid when purchasing a home worth more than £125,000 in England and Northern Ireland. First Time Buyers do not have to pay tax on any property costing up to £300,000.
For more information on Stamp Duty see: What is Stamp Duty?
Below we've listed the Stamp Duty Tax Rates based on house price, and the cost of Stamp Duty for second homes:
| House Price | Stamp Duty Rate | Second Home Stamp Duty Rate |
|---|---|---|
| Up to £125,000 | 0% | 3% |
| £125,001 to £250,000 | 2% | 5% |
| £250,001 to £925,000 | 5% | 8% |
| £925,001 to £1.5 million | 10% | 13% |
| £1.5 million+ | 12% | 15% |
Stamp Duty was replaced by the Land Transaction Tax in Wales (LTT) and the Buildings Transaction Tax (LBTT) in Scotland. Both LLT and LBTT are applied up to a maximum of 12%.
You can get an idea of what Stamp Duty will cost when buying a house by using our Stamp Duty Calculator.
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Extra Costs of Buying a House
When planning your budget, don't forget to factor in the extra costs associated with buying a house. These include the cost of removal services, self-storage, insurance, mail redirection and property maintenance.
1. House Removal Costs
The estimated cost of moving based on a 3-bed house, with the removal company travelling 50 miles is £1,181. The price depends on the company you choose, your location and the length of the journey. Other factors include whether you need a professional packing service or dismantling furniture. Depending on your requirements, moving costs range between £264 and £1,680.
Remember you can save up to 70% on your removals costs by comparing companies with us.
2. Storage
Storage can be utilised for items acquired before buying your home, or if you find yourself between house moves.
The Self Storage Association (SSA) reports that the UK average self-storage cost is £23.94 per sq. ft. Be aware that costs will vary between companies and across the country. The cost will also depend on whether you want a specialised like climate-controlled storage.
For more information read: How Much Does a Self Storage Unit Cost?
3. Insurance
According to ABI, the average price for combined buildings and content insurance in the first quarter of 2022 was £307.
Mortgage lenders require you to have building insurance in place from the day of completion. This must cover both the exterior building and any extensions, sheds or outhouses.
4. Mail Redirection
The Royal Mail charges £33.99 for redirection of mail within the UK for a period of three months.
Mail redirection is based on the resident’s surname. If you are moving with someone who has a different surname, they will also have to pay for redirection.
5. Property Maintenance
In addition to furniture and decor costs, you may need to save for any work that will be required. This could be as soon as you move in or further down the line.
Your survey will highlight potential issues and work that will be required. This can help you prepare for the costs before you complete the purchase. According to Lloyds Banking Group, the average UK homeowner spends £3,579 on interior house maintenance per year.
Next Steps of Buying a House
This article is part of our home buying guide. In the next article, we break down the time scale of buying a house, from mortgage application to completion day. Find out more read how long does it take to buy a house.
