How Much Money Do You Need to Buy a House in the UK?
The money needed to buy a house is much more than the property deposit. Buyers may also need cash for property tax, conveyancing, searches, surveys, mortgage fees, insurance, removals and unexpected repairs.
Simple answer: Your home-buying budget should include your deposit, purchase tax and every fee you must pay before or on completion. You should also keep some money available for moving costs, bills and urgent repairs after receiving the keys.
The exact amount depends on the property price, deposit percentage, mortgage product, property condition, location and whether the home is freehold, leasehold, new build or purchased at auction.
Your Complete Home-Buying Budget
A useful starting formula is:
Total savings needed = mortgage deposit + property tax + buying fees + moving costs + emergency fund
| Budget Area | What It May Include |
|---|---|
| Mortgage deposit | The part of the purchase price paid using your own money |
| Property tax | SDLT, LTT or LBTT depending on where the property is located |
| Legal costs | Conveyancing, searches, Land Registry fees and bank transfer charges |
| Property checks | Home survey, specialist inspections and mortgage valuation fees |
| Mortgage costs | Application, booking, arrangement, product or account fees |
| Moving costs | Removal company, van hire, storage, cleaning and packing materials |
| After-completion costs | Insurance, Council Tax, utilities, furniture and urgent repairs |
1. Your Mortgage Deposit
The mortgage deposit is usually the largest amount buyers need to save. It is the difference between the property price and the amount borrowed from the mortgage lender.
Example Deposit Amounts
| Property Price | 5% Deposit | 10% Deposit | 15% Deposit | 20% Deposit |
|---|---|---|---|---|
| £200,000 | £10,000 | £20,000 | £30,000 | £40,000 |
| £300,000 | £15,000 | £30,000 | £45,000 | £60,000 |
| £400,000 | £20,000 | £40,000 | £60,000 | £80,000 |
| £500,000 | £25,000 | £50,000 | £75,000 | £100,000 |
How to Calculate Your Deposit
Property price × deposit percentage = deposit required
For example:
£350,000 × 10% = £35,000 deposit
A larger deposit normally produces a lower loan-to-value ratio, commonly called LTV. This may affect the mortgage products and interest rates available, although each lender applies its own criteria.
Do not use your entire savings balance as the deposit. You will normally need separate money for legal costs, surveys, tax and moving expenses.
2. Stamp Duty and UK Property Taxes
The property tax you may pay depends on where the home is located. Different systems apply across the UK.
| Property Location | Property Tax | Important Starting Point |
|---|---|---|
| England and Northern Ireland | Stamp Duty Land Tax | Standard residential nil-rate band begins at £125,000 |
| Wales | Land Transaction Tax | Main residential nil-rate band extends to £225,000 |
| Scotland | Land and Buildings Transaction Tax | Standard residential nil-rate band extends to £145,000 |
First-Time Buyers in England and Northern Ireland
A qualifying first-time buyer purchasing a main home for no more than £500,000 currently pays:
- 0% Stamp Duty on the first £300,000; and
- 5% on the portion between £300,001 and £500,000.
If the property costs more than £500,000, first-time buyer relief does not apply and the standard residential rates are normally used.
First-Time Buyers in Wales
Wales does not currently provide a separate first-time buyer LTT relief. Buyers use the main residential rates where the higher residential rates do not apply.
First-Time Buyers in Scotland
Qualifying first-time buyers in Scotland receive an increased LBTT nil-rate threshold of £175,000. This can reduce the tax by up to £600.
Check your full ownership position: Additional-property rates or surcharges may apply if you already own another residential property, including certain properties outside the UK.
Property-tax rules can change, so calculate the amount using the relevant official service before fixing your final buying budget.
3. Solicitor and Conveyancing Costs
A solicitor or licensed conveyancer handles the legal work required to transfer ownership and, where applicable, satisfy the mortgage lender’s instructions.
Your quotation may include:
- the conveyancer’s legal fee;
- VAT;
- local authority, drainage and environmental searches;
- Land Registry documents and registration fees;
- identity and anti-money-laundering checks;
- bank transfer charges;
- Stamp Duty or property-tax return administration;
- leasehold or new-build supplements; and
- fees for gifted deposits, Help to Buy ISAs or Lifetime ISAs.
MoneyHelper indicates that legal fees may be around £2,000 including VAT, while property searches may cost approximately £250 to £300. Actual quotations can be higher or lower depending on the property and transaction.
Compare the complete quotation: A low headline legal fee may not include searches, VAT, leasehold work, lender charges or bank transfer fees.
4. Survey and Property Inspection Costs
A mortgage valuation is completed for the lender. It is not the same as an independent home survey for the buyer.
MoneyHelper provides the following broad survey cost indications:
| Survey or Inspection | Typical Use | Planning Figure |
|---|---|---|
| Level 1 Home Survey | A conventional property in apparently good condition | From around £380 |
| Level 2 Home Survey | A standard property where more detail is required | From around £400 |
| Level 3 Building Survey | An older, altered, unusual or visibly defective property | From around £600 |
| New-Build Snagging Survey | Identifying defects or unfinished work in a new home | From around £300 |
Prices usually increase with the property’s value, size, age, construction and location. Specialist inspections for damp, drainage, roofing, electrics, gas, timber or structural movement would normally cost extra.
A survey may look expensive when preparing a buying budget, but discovering major repairs after completion could cost considerably more.
5. Mortgage Fees
A mortgage can include several different charges. Not every lender or product uses every fee.
- Booking or application fee: MoneyHelper indicates approximately £100 to £200.
- Arrangement or product fee: Often around £1,000 to £2,000 or more.
- Mortgage account fee: Approximately £100 to £300 where charged.
- Mortgage valuation fee: This may be free or could cost approximately £150 to £800.
- Mortgage broker fee: Some brokers charge the buyer, while others receive commission from the lender.
A product with the lowest interest rate may not always have the lowest total cost. Buyers should consider the interest rate, mortgage fee, cashback, free valuation and any legal incentives together.
Adding a fee to the mortgage does not make it free. The fee becomes part of the mortgage balance and may attract interest until it is repaid.
6. Buildings Insurance
Mortgage lenders normally require suitable buildings insurance for the property. In England and Wales, cover is commonly arranged from exchange of contracts because the buyer may become responsible for the property at that stage, although the purchase contract should be checked.
Buildings insurance protects the structure of the home. Contents insurance protects belongings such as furniture, appliances and personal possessions.
Leasehold buyers should check whether buildings insurance is already arranged through the freeholder or managing agent and included within the service charge.
7. Moving and Setup Costs
Moving costs vary according to the distance, number of belongings, property access and whether packing or storage is required.
Your budget may need to include:
- removal company or van hire;
- packing boxes and protective materials;
- temporary storage;
- professional cleaning;
- mail redirection;
- changing locks;
- initial food and household supplies;
- furniture and appliances;
- broadband installation; and
- childcare or pet care on moving day.
MoneyHelper indicates that removal costs may begin at around £400 and can exceed £1,000. Larger moves, long distances, difficult access and storage can increase the total.
8. Leasehold and Managed Estate Costs
Flats and some houses can have additional charges that may be missed when calculating how much money is needed to buy the property.
Possible costs include:
- annual service charges;
- reserve or sinking-fund contributions;
- ground rent where legally payable;
- notice of transfer and mortgage fees;
- deed of covenant fees;
- management-company membership charges;
- certificate of compliance fees; and
- estate management charges for roads, landscaping or shared spaces.
Your conveyancer should report the known charges and payment requirements before exchange. Buyers should consider both the immediate completion charges and the ongoing annual cost.
9. Money Needed After Completion
Receiving the keys does not end the spending. A realistic home-buying budget should include the first few months of ownership.
Regular Household Costs
- mortgage repayments;
- Council Tax;
- gas and electricity;
- water charges;
- buildings and contents insurance;
- broadband and telephone services;
- service charges or estate charges; and
- routine maintenance.
Immediate Property Costs
- changing locks;
- boiler servicing;
- essential electrical or plumbing repairs;
- roof or drainage work;
- replacement appliances;
- basic decorating; and
- safety improvements.
Keeping a separate emergency fund can help prevent an urgent repair from immediately becoming new credit-card or personal-loan debt.
Worked Example: Buying a £300,000 Home
The following example shows how a qualifying first-time buyer in England might prepare an initial budget. It uses planning allowances rather than quotations.
| Cost | Example Amount |
|---|---|
| 10% mortgage deposit | £30,000 |
| Stamp Duty for a qualifying first-time buyer | £0 |
| Conveyancing and search allowance | £2,250 |
| Level 2 survey allowance | £500 |
| Mortgage fee allowance | £1,200 |
| Removal and moving allowance | £700 |
| Initial repairs and setup fund | £2,000 |
| Illustrative savings target | £36,650 |
A buyer who does not qualify for first-time buyer relief would normally pay £5,000 in standard SDLT on a £300,000 main-home purchase in England or Northern Ireland, assuming no additional-property or non-resident surcharge applies. Their example savings requirement would therefore rise to approximately £41,650.
Important: This example does not include every possible expense. Leasehold charges, gifted-deposit work, specialist inspections, storage, broker fees or urgent repairs could increase the total.
When Will You Need the Money?
| Buying Stage | Costs That May Be Payable |
|---|---|
| Before property search | Mortgage broker fee, credit documents and initial budget preparation |
| After offer acceptance | Solicitor payment on account, searches, mortgage application fee and survey |
| Before exchange | Buildings insurance and cleared funds for the exchange deposit |
| Before completion | Remaining purchase funds, property tax, legal balance and completion charges |
| Moving day | Removal company, storage, cleaning and key-related costs |
| After completion | Council Tax, utilities, insurance, service charges, repairs and furniture |
Some costs must be paid even if the purchase later falls through. Survey fees, valuation charges, mortgage booking fees, searches and part of the legal costs may not be refundable.
Home-Buying Budget Checklist
Deposit and Mortgage
- Mortgage deposit calculated
- Mortgage fees checked
- Broker fee confirmed
- Valuation fee checked
- Money kept aside for other costs
Legal and Property Checks
- Complete conveyancing quotation received
- Search costs included
- Land Registry fee included
- Survey budget prepared
- Specialist inspection allowance considered
Tax and Completion
- Correct UK property tax calculated
- First-time buyer eligibility checked
- Additional-property position checked
- Completion funds available in cleared money
- Buildings insurance arranged when required
Moving and After Completion
- Removal quotations compared
- First mortgage payment considered
- Council Tax and utilities budgeted
- Leasehold or estate charges checked
- Emergency repair fund retained
Frequently Asked Questions
Can I use all my savings as the house deposit?
You may need separate money for tax, legal work, surveys, mortgage charges and moving costs. Using every pound as the deposit could leave you unable to pay costs required before completion.
Are solicitor fees included in the mortgage?
Normally, legal and conveyancing fees are paid separately by the buyer. Some mortgage products may offer free or assisted legal services, but the terms and services included should be checked.
Do first-time buyers pay Stamp Duty?
It depends on the property location, price and eligibility. Qualifying first-time buyers in England and Northern Ireland currently receive SDLT relief on purchases costing no more than £500,000. Scotland has a smaller first-time buyer LBTT relief, while Wales does not currently have a separate first-time buyer LTT relief.
Do buyers pay estate agent fees?
The seller usually pays the estate agent. However, some auctions, buying services or specialist property arrangements may charge the buyer, so all terms should be checked before making an offer or bid.
What costs are lost if the purchase falls through?
Depending on the stage reached and the supplier’s terms, buyers may lose survey fees, searches, mortgage fees, valuation charges and legal costs already incurred.
Official UK Sources
- GOV.UK: Preparing to Buy a Home
- HMRC: Stamp Duty Land Tax Residential Rates
- Welsh Government: Land Transaction Tax Rates
- Revenue Scotland: Residential LBTT Rates
- MoneyHelper: Mortgage Fees and Home-Buying Costs