Understanding the costs of buying a new home

Key Takeaways

1. Deposit: you’ll need a deposit of at least 5% of the purchase price of the property, though some lenders may require a 10% deposit. A larger deposit results in a lower Loan to Value (LTV).

2. Mortgage Costs: these include arrangement fees and mortgage broker fees. Some are paid upfront, while others can be added to your mortgage on completion.

3. Stamp Duty: as of April 2025, Stamp Duty is structured in bands. No Stamp Duty is payable on the first £125,000 of a property’s value. A 2% rate applies to the portion between £125,001 and £250,000, 5% between £250,001 and £925,000, 10% between £925,001 and £1.5 million, and 12% on any value above £1.5 million.

4. Surveyor Fees: survey costs vary based on property value. Consider RICS Condition reports, Home Condition Surveys, or comprehensive building surveys.

5. Legal Fees: solicitor or conveyancer fees can range from £500 to £1,500+, including VAT. Costs depend on purchase complexity, property type and location.

6. Repairs: new-build homes may require fewer early repairs, while other properties might need maintenance or updates after purchase.

Upfront costs before completion

Before completion day, there are usually several upfront costs to budget for. These usually include:

• Your deposit (often 5–20% of the property price)

• Solicitor fees

• Survey costs – from a basic Condition Report to a more detailed Building Survey

You may also pay for mortgage arrangement and broker fees, ID checks, local authority searches and Stamp Duty if applicable.

Your deposit is usually paid at the point you exchange contracts, which is when the sale becomes legally binding.

Deposit requirements explained

Your deposit is usually one of the biggest upfront costs when buying a home. Many lenders ask for 5–20% of the property price, but paying more reduces your loan-to-value (LTV) ratio and may help unlock better mortgage rates.

Legal and conveyancing fees

When you buy a property, a solicitor or licensed conveyancer can manage the legal work involved in the purchase. Fees typically range from £500–£1,500+, depending on the property type, location and the complexity of the transaction.

These costs usually cover ID checks, property searches, and preparing and handling contracts.

Stamp duty costs

Stamp Duty is a tax that may apply when buying a home. As of April 2025, there’s no Stamp Duty on properties up to £125,000, while first time buyers benefit from a higher threshold of £300,000.

To work out what you’ll pay, read our Stamp Duty guide or check official Government guidance.

Surveyor fees

A property survey assesses the home’s condition and highlights any structural issues or defects. The right survey depends on the property’s age, type and complexity. Common options include:

• RICS Condition Report – the most basic assessment, outlining any obvious issues

• Home Condition Survey – a more detailed inspection suitable for most modern homes

• Building Survey – an in-depth structural report, often recommended for older or unusual properties

For new builds, a snagging survey can identify defects or unfinished work your developer should fix before or shortly after you move in.

Survey costs vary depending on the level of inspection and the value of the property. Read our guide to learn more about the different survey types and what they cost.

Mortgage-related costs

When securing a mortgage, you may encounter several additional fees. These can vary by lender, property type and the level of support you choose:

• Arrangement fees – typically £1,000–£2,000. You can pay upfront or add them to your mortgage (though adding them means paying interest over the term).

• Valuation fees – your lender will assess the property’s value to confirm its suitable security for the loan. Costs vary depending on the valuation type and provider; basic valuations may be free, while more detailed reports cost more.

• Mortgage broker fees – some charge £300–£5,000, while others are paid by lenders through commission. Using a broker isn’t essential. Some buyers use brokers to compare products and manage the application process, while others apply directly with lenders.

Costs you’ll pay on completion

On completion, you’ll settle the final costs involved in officially buying your new home. These may include:

• Final purchase balance – the remaining amount after your deposit, transferred to your solicitor to complete the purchase.

• Mortgage fees due at completion – any charges you’ve chosen to add to your mortgage (such as arrangement fees) may be applied at this stage.

• Stamp Duty – if applicable, your solicitor will collect and pay this to HMRC shortly after completion.

• Insurance responsibilities – buildings insurance should usually start on the day you exchange contracts, but you’ll need it in place for completion to satisfy your lender’s requirements.

Ongoing costs of homeownership

Once you’ve moved in, there are several ongoing costs you may need to budget for. Regular expenses can include:

• Maintenance and minor repairs – boiler servicing, heating checks, alarm upkeep, garden maintenance, gutter clearing and general external care.

• Service charges or estate management fees – can be common for new build developments to cover maintenance for communal areas, landscaping or private roads.

• Buildings and contents insurance – buildings insurance is often a mortgage requirement and covers the cost of repairing or rebuilding the structure of a home; contents insurance can help protect your belongings. Costs vary by property type, location and cover level.

• Optional protection policies – life insurance or income protection can help safeguard your mortgage payments if your circumstances change.

• Utility bills – gas, electricity, water, broadband and TV licence.

• Council tax – based on your property’s band and local authority rates. You can check your band on your council’s website.

Final cost checklist

As you get closer to completing your home purchase, it can be helpful to think through the different costs that may be involved, including:

1. Your deposit
2. Legal and conveyancing fees
3. The type of survey you choose
4. Stamp Duty, if applicable
5. Mortgage-related fees
6. Insurance cover
7. Moving expenses
8. Any service charges or estate management fees
9. Potential snagging work
10. Ongoing running costs