First-time buyers paying £38K up front
Average cost of buying a first home climbs above £38,000 as removal costs surge
New research from Lyons Bowe that the average cost of buying a first home now stands at £38,353, with first-time buyers facing substantial upfront costs beyond the purchase price itself, as removal costs continue to soar.
Lyons Bowe examined the average cost of the key aspects of homebuying for first-time buyers, from deposits and mortgage repayments through to conveyancing, surveys and removals, to understand the financial burden facing those taking their first step onto the property ladder.*
The analysis shows that the current average cost of buying a first home, excluding the full purchase price of the property itself, now stands at an estimated £38,353.
At £38,353, the average upfront cost of buying a home represents a significant financial hurdle for aspiring homeowners, with the deposit alone accounting for almost nine-tenths (88.5%) of the total cost involved.
The average first-time buyer deposit currently stands at £33,937, based on a typical 15% deposit requirement, making it by far the largest upfront expense associated with purchasing a property.
While first-time buyers purchasing below the current Stamp Duty threshold in England and Northern Ireland avoid paying SDLT altogether, a range of associated costs continue to place pressure on affordability.
The biggest increase has been seen in removal costs. The average cost of moving a typical three-bedroom home has surged by 42.8% over the last year, pushing the average bill to £1,312.
The cost of financing a home purchase remains another significant expense, with the average first monthly mortgage repayment now standing at £1,068.
Other ancillary costs have also edged higher. The average cost of a home survey has risen by 1.1% to £597, while the average cost of conveyancing has increased by 4% over the last year to £1,439. Despite this increase, conveyancing accounts for just 3.8% of the overall cost of buying a first home.
However, the cost of getting onto the property ladder varies considerably across the country.
For example, London buyers are facing upfront costs of around £83,181; more than double the national average.
The capital’s higher house prices mean that first-time buyers require an average deposit of £69,486, while the average first monthly mortgage repayment sits at £2,186. Unlike many buyers elsewhere in the country, first-time buyers in London also face an average Stamp Duty bill of £8,161, which accounts for almost 10% of the total cost of purchasing a home.
Paul Lyons, Managing Director at Lyons Bowe Solicitors, commented:
“While most first-time buyers focus on saving for a deposit, our research shows that the true cost of buying a home extends far beyond this.
Although first-time buyers benefit from Stamp Duty relief in many parts of the country, a range of other costs continue to add up, and rising associated costs in particular have increased the overall financial commitment required.
The picture is even more challenging in higher-value markets such as London, where buyers face upfront costs of more than £83,000 before they’ve even moved into their new home.
Conveyancing remains one of the smallest costs involved in buying a property, accounting for less than 4% of the overall expense, yet it plays a vital role in protecting buyers throughout what is likely to be the biggest financial transaction of their lives. Securing experienced legal support can help avoid delays, identify potential issues early and provide peace of mind throughout the process.”
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