First-time buyers underestimate buying costs

Many first-time buyers do not accurately estimate the cost of buying a home, according to a new study.

Research from Aldermore revealed often those stepping on to the property ladder underestimate the cost of buying and the associated costs of become a homeowner.

The deposit remains the top obstacle for first-time buyers, with many underestimating the amount needed by 31 per cent.

Other unexpected costs come in the form on solicitors and home surveys, with 40 per cent spending an additional £2,334 on such services.

The time it takes to save a suitable deposit was also underestimated by potential homeowners, with 58 per cent believing they would reach their goal within five years, with just 51 per cent achieving this and 16 per cent taking more than eight years.

 “It is clear there is a divergence between perception and reality when it comes to the house buying process. This often means those looking to buy are under estimating the associated costs as well as the time it could take to complete, especially with first time buyers expecting it to take four years on average to save for a deposit,’ said Charles McDowell, commercial director of mortgages at Aldermore.

“This lack of understanding clearly has financial implications but it can also take its toll emotionally.”