The Cost of Buying Property: Hidden Fees Explained

Waqas Ali
5 days ago
2 min read

It’s More Than Just the Deposit

Most buyers focus on saving for their deposit, but that’s only part of the picture. Behind every property purchase lies a set of hidden costs that can add thousands to your total spend.

At Genius Academy, we believe transparency is key. Understanding these costs upfront helps you budget wisely, negotiate confidently, and avoid last-minute financial stress.

Why These Costs Matter

Whether you’re buying your first home or expanding a portfolio, hidden fees affect:

Your affordability – lenders consider your available savings beyond your deposit.
Your timeline – missing payments can delay completion.
Your returns – every pound spent upfront reduces short-term ROI.

Knowing them in advance turns uncertainty into preparation.

1️⃣ Stamp Duty Land Tax (SDLT)

What it is: A government tax on property purchases above certain thresholds.

Key points:

First-time buyers in England pay nothing on the first £425,000 (as of 2024 rules).
For buy-to-let or second homes, add a 5% surcharge on top of standard rates.

Example: A £300,000 buy-to-let = approx. £14,000 stamp duty.

2️⃣ Legal Fees (Conveyancing)

Your solicitor handles contracts, title checks, and fund transfers. Expect to pay £1,000–£2,000, depending on property type and complexity.

Additional fees may include:

Searches: £250–£400
Bank transfer fee: £25–£50
Land Registry fee: £150–£500

Tip: Always use a conveyancer experienced in leaseholds if you’re buying a flat.

3️⃣ Valuation and Survey Costs

Before lending, your mortgage provider orders a valuation (typically £250–£600). You can also request independent surveys for peace of mind:

HomeBuyer Report: £400–£900
Building Survey: £800–£1,500

Think of this as insurance against hidden defects — small cost, big protection.

4️⃣ Mortgage Arrangement & Broker Fees

Some lenders impose an arrangement fee (up to £1,000–£1,999), which you can either add to your loan or pay upfront.

If you use a mortgage broker, expect:

5️⃣ Insurance and Protection

Before completion, you’ll need:

Building insurance protects the structure; it is required by lenders.
Contents insurance – optional but recommended.
Life or income protection is optional, but smart for mortgage holders.

Budget around £300–£800 per year depending on coverage.

6️⃣ Moving and Miscellaneous Costs

Don’t forget the final stretch:

Removals and storage: £400–£1,000
Utility setup and council tax: varies by area
Furniture and décor: highly variable but easy to underestimate

Including a small buffer (1–2% of the purchase price) keeps surprises manageable.

Even a “10% deposit” buyer actually needs around 15%+ of the property price to cover everything comfortably.

Example: Total Cost on a £250,000 Buy-to-Let Purchase

Cost Type	Approx. Amount
Deposit (30%)	£75,000
Stamp Duty (5%)	£12,500
Legal & Searches	£1,400
Valuation & Surveys	£600
Mortgage Fees	£995
Insurance	£500
Moving & Misc.	£800
Estimated Total	£91,795

The Smart Investor’s Approach

Property isn’t just about capital — it’s about cash flow management. The most successful investors anticipate all costs before making a commitment, which helps them avoid unexpected expenses during exchange or completion.

At Genius Academy, we encourage all buyers to create a cost map for each purchase — because preparation is profit.