The Cost of Being a Homeowner
Owning your own home is high on most people’s list of life goals – but it certainly doesn’t come cheap. There are many elements to home ownership that can add up to eye-watering sums. Interestingly, though, the cost of owning a home can vary widely in different parts of the world. Could it make financial sense for you to move to a different country to achieve your home ownership plans? Let's take a look…
Average reading time: 5 mins 30 seconds
Interestingly, though, the cost of owning a home can vary widely in different parts of the world. Could it make financial sense for you to move to a different country to achieve your home ownership plans?
Let's take a look…
The first step of home buying is of course to work out what properties cost and set your budget accordingly
While the UK has a reputation as an expensive property market, this is largely based on prices in London, which are very high compared to the rest of the country. The most expensive countries for city properties in Europe are the UK, France and Austria, according to statista.com.
But, when you compare average property prices in 40 countries worldwide, the UK sits in the middle range. It’s below Germany, the Netherlands, Ireland, New Zealand and Canada. The average house price this year in the UK is £231,163.
The most expensive country for property in 2018 was Iceland, followed by Turkey, China, Hungary and Ireland. The cheapest countries include Italy, Greece and Russia.
Data available at: https://data.oecd.org/price/housing-prices.html
It’s important to remember that there are other costs involved in buying a home. In the UK, for example, there is stamp duty – a property tax. This takes effect on any house worth more than £125,000 and increases with the value of the property, up to a maximum of 12% of its total value.
For a home worth £231,100, the stamp duty due is £2,122. There are also legal fees for solicitors to complete contracts and other paperwork, which on average can total around £1,500.
Once you have completed the home purchase you’ll probably need help moving your belongings into it. In the UK the average removal company costs for a three-bedroom house are around £2,0001.
Kitchens and bathrooms
At some point you are likely to want to restyle your kitchen and bathroom, which again adds to the cost of owning a home. Most people will tell you it’s well worth it though! A luxurious and inspiring bathroom can really shape the start of your day; or be the perfect place to unwind at the end of it.
The UK’s average bathroom costs £4,500. Opting for the most opulent fixtures, fittings and furnishings can increase this cost considerably, but whatever your budget, you can create a beautiful bathroom by planning wisely, as we explore in this article on keeping costs down. A walk-in rainfall shower or a freestanding bath could be the key to your perfect space.
Our kitchens are just as important: most of us enjoy entertaining friends and family at home and dream of the perfect space for cooking, dining and partying.
The average cost of a new kitchen in the UK is around £8,0002 – but some people spend much more. If you want hand-built units and top-quality granite worktops you can pay more than £20-30,000.
The total cost of homeownership
Taking all these elements into consideration, then, here’s what it costs to own a home (using the UK as an example):
So the average house will cost us over £300,000 over a lifetime – and that’s before buying furniture and redecorating. It’s certainly not a cheap thing to do, but most homeowners will tell you that buying their own place and making it a home is one of their most rewarding achievements.
Brexit and the property market
The uncertainty of Brexit continues and people looking to get on the UK property ladder are unsure what lies ahead. It’s still not clear whether we will leave Europe without a deal, and how this will affect the British economy and property market.
There have been predictions that a no-deal Brexit will send property prices plummeting – in fact, recent news coverage has suggested that they could fall by up to 35 per cent.
Generally, people believe that London house prices will be the most affected by what lies ahead – partly because it has seen the most dramatic property price rises in recent years.
What should a potential homebuyer do?
The housing market has slowed this year as people wait to see how Brexit will affect us. The savvy homebuyer will keep a close eye on Brexit developments and be ready to take advantage of any price drops or general changes in the market.
The good news is that as the rate of house sales slows down, mortgage lenders are making their deals more competitive to attract customers, which is a boost to new homeowners.
Buying a home is costly and, at the moment, a little unpredictable, so make sure you do your homework before taking the plunge.