Saving Supplements

In this workout we’ll cover deposit sizes, Loan to Value, commonly referred to LTV,  and other costs to factor in, so you're not overwhelmed by what else you’ll need money for when you’re buying. It’s better to know now and be prepared for it, and with this workout, we’ll help you get there.

How the size of your deposit affects your options

A 5% deposit doesn’t sound like a lot, but that figure could be over £9,000 based on the average house price in Wales^, so saving can feel overwhelming. Take the time to break down how much you’ll need, set a long term goal, and how you’re going to get there. Think of it like doing your steps, the more you do the better you feel.

When you’re looking at mortgages you’ll see they’re named things like ‘95% LTV Fixed Rate Mortgage’. The percentages range from 95 down to 60 and indicate the amount you have to borrow against the value of your property and is known as the Loan to Value (LTV). 

How does LTV work?



Why does LTV matter?

Generally, the bigger your deposit (and the lower your LTV), the lower the interest rate on your mortgage.

What other costs are there?

Saving up for a house and moving in is one of the biggest and most exciting things you’ll ever do. However, there are a number of hidden costs involved, so we’ve broken them down for you below so you can add them into your budget:



Upfront costs

  • Deposit - usually ranges from 5% to 20%
  • Land tax - In Wales you pay land transaction tax when you buy over £180,000. In England you pay Stamp Duty Land Tax when you buy over £125,000
  • Surveyors - a Home Buyer’s Report costs between £350 and £900, and a full structural Building Survey starts at £500
  • Legal - You’re looking at around £750 to £1,500
  • Property registration free - Expect to pay £300 on average
  • Electronic transfer fee - £40 - £50



Mortgage costs

  •  Booking fee - from £100 to £250
  • Arrangement fee - generally around £975
  • Valuation fee - could add £250 -£1000 to your bill



Moving costs

  • Removal expenses – Ask your family and friends but if you need some outside help expect to pay around £200 for a van and around £500 for a removals company
  • Cleaning - could be between £100 and £250
  • Removals insurance - usually costs around £30
  • Storage – £140 per month



Ongoing costs

  • Insurance – buildings and contents - this can vary based on postcode so check for a quote but consider £250 combined
  • Council tax - The average council tax bill can cost you anything between £650 and £1,800 per year
  • Service charges & ground rent - Ground rent typically costs between £100 and £250. But service charges can amount to over £1,000 a year
  •  Utilities & other regular costs 
^ Average house price of £193,000 based on Principality's House Price Index Q4 2019