Buying your first house is an exciting milestone, it’s important to get prepared and consider all of the costs of buying a house. Beyond the purchase price of the property, there are extra expenses to consider. Understanding these costs in advance can help you budget and avoid any financial surprises as you embark on your journey to homeownership.

There are what some might consider hidden costs to buying a house that aren’t immediately known without proper research. These can include:

1. Deposit

If you’re a first-time buyer, you’ll normally need a deposit of at least 10% of the purchase price. For example, if you’re buying a house or apartment worth €400,000, you’ll need a deposit of at least €40,000. First time buyers may be able to cover some of the deposit using the Help to Buy scheme, which can provide up to €30,000 towards your deposit on certain properties by way of a refund of income tax and/or DIRT which you have paid.

2. Stamp Duty

Stamp duty is a tax you must pay to the Revenue Commissioners when buying property in Ireland. For residential properties, the rate is at the time of writing this article, 1% up to €1 million and 2% on the amount over €1 million. For example, on a €300,000 home, you'd pay €3,000 in stamp duty. For new builds, stamp duty is calculated on the base price minus VAT. So, if a new home costs €340,500 (including VAT), you'd pay stamp duty on the €300,000 base price, which totals €3,000. Your solicitor will handle the payment arrangements with the Revenue Commissioners.

3. Legal costs when buying a house

You’ll need a solicitor to manage the legal tasks involved in transferring ownership of your new house. Solicitors may charge a flat fee or a percentage of the property price which is usually 1 or 2%. The fees a solicitor will charge generally depend on the level of work or billable hours involved in the conveyancing process.

You should also expect to pay VAT and other costs associated with the legal process, such as Land Registry fees and legal searches. While legal costs can vary, they generally range from €1,500 to €2,000 in total for an average home, it is usually best to review different solicitors and query standard conveyancing prices at their practice before committing. This legal cost is payable by you and covers the cost of conveyancing and legal advice from your chosen solicitor. More information on the legal costs and finding a solicitor can be found on the Law Society of Ireland website.

4. House Valuation Fees

When buying a house, your lender will require a valuation report to confirm how much the house is worth. This report, provided by a professional valuer approved by your lender, estimates the property’s market value, and confirms you’re not paying more than it’s worth. Typically, you’ll pay between €150 and €250 for this service, plus VAT.

5. Surveyors’ Fees (Optional)

Before purchasing a home, consider getting a professional surveyor’s report to identify hidden defects or structural issues, such as damp or dry rot. While not always required by lenders, a survey can provide crucial insights and help you understand what you’re buying. Surveyor fees typically range from €300, plus VAT at 23%. Although it is optional, investing in a survey can reveal potential problems and assist in price negotiations.

6. Home Insurance, Life Insurance, and Property Tax

You may not be thinking of fires or floods when you’re just about to buy your new home, but home insurance is essential. It protects your property and belongings from risks like fire and storm damage.

Additionally, lenders will require mortgage protection insurance, which covers your mortgage balance if you pass away. Property tax is also a fee you need to consider. This is a self-assessed tax paid annually to Revenue and is currently based on the market value of your home.

7. Moving Costs

Finally, when it’s time to move into your new home, you’ll want to make the experience as exciting and stress-free as possible. Whether you choose to rent a van and move your belongings yourself or hire a professional removal company, budgeting for these costs is essential.

The excitement of settling into your new space should be complemented by a smooth and seamless moving process. Get quotes from different moving companies or calculate the cost of renting a van to ensure you’re prepared for this final step in your home-buying journey.

Let Avant Money Help You Prepare

Our expert mortgage advisors can help you understand all the expenses involved in buying a house. Additionally, our user-friendly mortgage calculators can help you manage your home-buying budget and understand how much you can borrow. Visit Avant Money First Time Buyer Mortgages for further information on the mortgage process for first time buyers.

The above content of this blog is intended to provide general information only and does not constitute financial or professional advice from Avant Money. Readers should always seek independent professional advice and not solely rely on the information within the contents of this blog.

For more information on Avant Money mortgages, please visit https://www.avantmoney.ie/mortgages. Some of the links in the above article may bring you to external websites. Your use of an external website is subject to the terms of that site.

Lending criteria and terms and conditions apply. Applications from residents of ROI over the age of 18 only, and subject to repayment capacity, financial status and property valuation. We require property and life insurance.

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