First-time buyer costs are easy to underestimate because the deposit gets most of the attention. The real budget includes the deposit, stamp duty, mortgage fees, conveyancing, searches, survey, insurance, moving costs and money left over for repairs or emergencies.
A buyer who has exactly enough for the deposit can still be short if they forget the surrounding costs. The safer approach is to build a full purchase budget before viewing properties seriously.
Start with your borrowing and property budget
Use our Mortgage Affordability Calculator to estimate borrowing, deposit impact and property budget before adding buying costs.
First-time buyer costs checklist
The table below shows the main costs to plan for. Some are paid before completion, some on completion, and some shortly after moving in.
| Cost | What it covers | When it matters |
|---|---|---|
| Deposit | Your cash contribution towards the property purchase. | Needed before exchange/completion and affects LTV. |
| Property tax | SDLT in England/NI, LTT in Wales or LBTT in Scotland. | Usually handled by your solicitor/conveyancer after completion. |
| Mortgage fee | Product, arrangement, valuation or booking fees depending on the lender and deal. | May be paid upfront or added to the mortgage. |
| Survey | Checks the property condition beyond the lender’s valuation. | Useful before committing, especially for older or unusual homes. |
| Legal fees and searches | Conveyancing, local authority searches, title checks and transaction handling. | Needed to complete the purchase legally. |
| Insurance | Buildings insurance, contents insurance and optional protection cover. | Buildings insurance is usually needed from exchange for freehold purchases. |
| Moving and setup costs | Removals, storage, furniture, appliances, broadband setup and basic repairs. | Paid around move-in and often underestimated. |
1. Deposit
The deposit is usually the biggest upfront cost. It reduces the amount you need to borrow and affects your loan-to-value. A larger deposit can improve the range of mortgage deals available. An agreement in principle from a lender can help confirm what you can borrow before committing, but it should not leave you with no cash after completion.
A 5% deposit on a £250,000 property is £12,500. A 10% deposit is £25,000. A 15% deposit is £37,500. The higher the deposit, the lower the mortgage loan and LTV.
| Property price | 5% deposit | 10% deposit | 15% deposit |
|---|---|---|---|
| £200,000 | £10,000 | £20,000 | £30,000 |
| £250,000 | £12,500 | £25,000 | £37,500 |
| £300,000 | £15,000 | £30,000 | £45,000 |
| £400,000 | £20,000 | £40,000 | £60,000 |
Check your deposit and LTV
Use our Loan-to-Value Calculator to see whether your deposit gives you 95%, 90%, 85%, 80%, 75% or lower LTV.
2. Stamp duty, LTT or LBTT
Property tax depends on where the property is. England and Northern Ireland use Stamp Duty Land Tax. Wales uses Land Transaction Tax. Scotland uses Land and Buildings Transaction Tax.
In England and Northern Ireland, eligible first-time buyers pay no SDLT up to £300,000 and 5% on the portion from £300,001 to £500,000. If the purchase price is over £500,000, first-time buyer relief does not apply and standard rates are used.
Wales does not have a separate first-time buyer LTT relief. Scotland has first-time buyer LBTT relief that increases the nil-rate band to £175,000, with a maximum saving of £600.
| Location | Tax system | First-time buyer treatment |
|---|---|---|
| England and Northern Ireland | SDLT | 0% up to £300,000, then 5% from £300,001 to £500,000. No relief over £500,000. |
| Wales | LTT | No separate first-time buyer relief. Main residential LTT rules apply unless another relief is relevant. |
| Scotland | LBTT | First-time buyer relief increases the nil-rate band to £175,000, saving up to £600. |
Calculate property tax before making an offer
Use our Stamp Duty Calculator to estimate SDLT, LTT or LBTT based on location, buyer type and purchase price.
3. Mortgage fees
Some mortgage deals include fees. These might be called product fees, arrangement fees, booking fees or valuation fees. Not every deal has the same structure, and a lower interest rate is not always cheaper if the fee is high.
A fee can be paid upfront or added to the mortgage, depending on the lender and product. Adding a fee to the mortgage may feel easier at the start, but it can increase the amount you borrow and the interest charged over time.
Do not compare rate alone: a fee-free mortgage with a slightly higher rate can sometimes beat a lower-rate mortgage with a large fee, especially on smaller loans.
4. Survey and valuation costs
The lender’s valuation protects the lender. It is not the same as a full survey for your benefit. A buyer survey can help you understand the property condition before you fully commit.
Survey needs vary. A newer, straightforward property may need a lighter report, while an older home, unusual construction, visible cracking, damp concerns or major renovation plans may justify a more detailed survey.
- Valuation: checks the property is suitable security for the lender.
- Homebuyer-style report: looks at visible condition and common defects.
- Building survey: more detailed and often used for older, unusual or heavily altered properties.
5. Legal fees, searches and conveyancing
Your solicitor or conveyancer handles the legal transfer of the property. Their work can include title checks, searches, enquiries, contract review, lender requirements, funds transfer and registration.
Searches can cover local authority matters, drainage and water, environmental issues and other location-specific checks. Leasehold properties can involve extra work because the legal pack, lease terms, service charge and ground rent position need review.
- Legal fee for the conveyancer’s work.
- Search fees and disbursements.
- Land Registry fees.
- Bank transfer fees.
- Leasehold supplement where relevant.
6. Insurance and protection
Buildings insurance is normally required by the lender and is usually needed from exchange for freehold purchases. Contents insurance is separate and covers your belongings.
Some buyers also consider life insurance, critical illness cover or income protection, especially where the mortgage depends on one income or a household would struggle if income stopped.
Budget point: insurance is not just a one-off buying cost. It becomes part of the monthly home ownership budget.
7. Moving, setup and repair costs
Moving costs are easy to dismiss until completion is close. Even a simple move can involve removals, storage, van hire, furniture, appliances, cleaning, broadband setup and basic repairs.
First-time buyers often move from rented or family accommodation into an empty home, so furniture and appliances can become a large early cost. A cash buffer is useful because the first few months can reveal repairs that were not obvious during viewings.
- Removals or van hire.
- Furniture, beds, sofas and storage.
- White goods and appliances.
- Curtains, blinds and basic flooring.
- Locks, safety checks and small repairs.
- Broadband, utilities and council tax setup.
Example first-time buyer budget
The example below shows how quickly the total can grow once the deposit is separated from the other buying costs.
| Item | Example amount | Notes |
|---|---|---|
| Property price | £300,000 | Example first home purchase. |
| 10% deposit | £30,000 | Creates a 90% LTV mortgage before fees. |
| Mortgage amount | £270,000 | Property price minus deposit. |
| SDLT in England/NI | £0 | Eligible first-time buyer relief applies up to £300,000. |
| Other buying costs | Several thousand pounds | Legal work, surveys, mortgage fees, removals, insurance and setup costs. |
| Cash buffer | Keep separate | Useful for repairs, bills and unexpected costs after completion. |
Turn the mortgage amount into a monthly payment
Use our UK Mortgage Repayment Calculator to estimate monthly repayments and total interest across the full mortgage term.
Lifetime ISA and first-time buyer savings
A Lifetime ISA can help some first-time buyers save for a deposit. The government adds a 25% bonus to eligible Lifetime ISA savings, up to a maximum bonus of £1,000 per year.
The Lifetime ISA has strict rules. It can be used for a first home that meets the scheme rules, or for later-life saving. Withdrawals for other reasons can trigger a withdrawal charge, so buyers should check the rules before relying on it.
Check eligibility before saving: property price limits, age rules, account age and withdrawal rules can affect whether a Lifetime ISA works for your purchase.
How to avoid being short on completion
The safest first-time buyer budget keeps the deposit separate from the buying-cost pot. If all savings are counted as deposit, the buyer can run into problems when legal fees, survey costs, insurance and moving costs arrive.
- Set your minimum deposit target.
- Estimate property tax based on location and price.
- Get quotes for conveyancing and surveys before offering.
- Check mortgage product fees and whether they are upfront or added to the loan.
- Keep a separate emergency and repairs buffer.
- Do not rely on every pound of savings being available for deposit.
Good target: have enough for the deposit, the known buying costs and a separate post-completion buffer before stretching to a higher property price.
Common first-time buyer cost mistakes
The biggest mistake is treating the deposit as the whole budget. The second biggest is forgetting that home ownership starts immediately after completion, when repairs, bills and setup costs begin.
- Spending every pound on the deposit: this can leave no room for legal fees, surveys or repairs.
- Ignoring property tax: SDLT, LTT or LBTT can change the budget depending on location and price.
- Skipping a suitable survey: a cheap purchase can become expensive if hidden issues appear later.
- Comparing mortgage rates only: fees can change which deal is cheaper overall.
- Forgetting leasehold costs: service charges, ground rent and lease terms can affect affordability.
- Not leaving a cash buffer: repairs and setup costs often arrive quickly after moving in.
First-time buyer costs FAQs
What costs do first-time buyers need to budget for?
First-time buyers need to budget for the deposit, property tax, mortgage fees, valuation, survey, conveyancing, searches, insurance, removals, furniture and a repairs buffer.
Do first-time buyers pay stamp duty?
In England and Northern Ireland, eligible first-time buyers pay no SDLT up to £300,000 and 5% on the portion from £300,001 to £500,000. If the property price is over £500,000, standard rates apply instead.
Is there first-time buyer relief in Wales?
Wales does not have a separate first-time buyer Land Transaction Tax relief. Welsh residential purchases use the LTT rules unless another specific relief applies.
Is there first-time buyer relief in Scotland?
Scotland has first-time buyer LBTT relief that increases the nil-rate band to £175,000. The maximum tax saving is £600.
Should first-time buyers spend all their savings on the deposit?
Usually not. It is safer to keep money aside for legal fees, surveys, moving costs, insurance, furniture, repairs and emergencies after completion.
Plan the full first-time buyer budget
Once you know the deposit, property tax and estimated mortgage payment, compare mortgage deals and check whether the monthly cost still fits your income.
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Related mortgage tools and guides
Sources used for factual context: GOV.UK SDLT residential rates and first-time buyer relief, MoneyHelper buying and moving cost guidance, GOV.WALES LTT overview, Revenue Scotland LBTT first-time buyer relief and GOV.UK Lifetime ISA rules. Check property tax thresholds and savings rules again before future publication updates.