New home expenses for first‑time buyers

Insurance costs

Insurance is one of the ongoing home costs that first‑time buyers may encounter after completion. Mortgage lenders typically require buildings insurance to be in place from the point of contract exchange. Other types of insurance are optional and may form part of wider household budgeting. Insurance costs vary depending on the property, level of cover and provider.

Buildings vs contents insurance

Buildings insurance covers the structure of a property, including permanent fixtures such as walls, roofs and windows. It generally covers damage caused by insured events such as fire or flooding. For houses and buildings, insurance is usually arranged by the homeowner. For flats, arrangements are often made by the freeholder and paid through service charges, although this should be confirmed in each case.

Contents insurance covers personal belongings inside the home, such as furniture and appliances. This type of cover is usually arranged by the homeowner, regardless of property type. Levels of cover, exclusions and limits vary between policies.

Council tax

Council tax is a compulsory charge set by local authorities to fund local services. The amount payable depends on the property’s council tax band and the local council's rate. New‑build homes are assessed individually and allocated a band by the Valuation Office Agency.

Council tax is usually payable from the completion date and is commonly spread across 10 or 12 monthly instalments. Discounts or reductions may apply in certain circumstances, such as single‑occupancy households, subject to eligibility and local authority criteria.

Other ongoing monthly costs for first‑time buyers

Alongside mortgage payments and property‑specific charges, there are other ongoing monthly costs that can affect household budgets. These vary depending on usage, location and individual choices. Common ongoing home costs may include:

• Utility bills and broadband

• Maintenance and repairs

• Parking permits, where applicable

New‑build homes are often designed to meet current energy efficiency standards, which can influence utility usage. However, actual costs depend on factors such as energy consumption and tariffs, which can change over time.

Utility bills and broadband

Utility and communication costs typically include:

• Gas and electricity. If the previous occupier has notified their supplier, a new homeowner is often placed on a standard energy tariff initially. Tariffs and suppliers vary, and costs depend on usage and pricing structures.

• Water. Water services are generally provided by a regional supplier based on the property’s location, rather than through consumer choice between providers.

• TV and broadband. Costs vary depending on provider, package and contract terms. Introductory pricing may apply to some products, though longer‑term costs can vary.

Maintenance and repairs

Homeowners are responsible for maintaining their property, including repairs that may previously have been handled by a landlord when renting. Maintenance needs can arise at unpredictable times, and costs can vary depending on the issue.

New‑build homes may have lower initial maintenance requirements, as fixtures and systems are newly installed. However, maintenance responsibilities still apply, and costs can increase over time. Examples of routine maintenance activities include:

• Boiler servicing

• Periodic electrical inspections

• External upkeep, such as gutters and fencing

• Addressing issues such as leaks or structural wear

Parking permits

Some properties require parking permits, which may involve ongoing or annual charges. Availability, cost and eligibility are set by local authorities or managing agents and vary by location.

Costs for flats and leasehold homes

Flats are commonly sold as leasehold properties, meaning the homeowner owns the property for a fixed period rather than owning the land outright. Leasehold ownership can involve additional ongoing costs not applicable to freehold houses. These costs are set out in the lease and can vary between developments.

For more information, take a look at our freehold vs leasehold guide.

Service charges

Service charges contribute to the maintenance and management of shared areas within a building or development. This may include cleaning, lighting, building insurance and upkeep of communal spaces. Some developments also include facilities such as lifts or shared gardens.

Service charges are not fixed and may change over time depending on management decisions and maintenance needs. Buyers are typically provided with estimates before purchase, although actual charges can differ.

Ground rent

Ground rent is a payment made to the freeholder for the land on which a leasehold property is built. In some newer developments, ground rent is set at a low level or removed, although this is not universal.

Ground rent terms, including review periods and escalation clauses, are detailed in the lease. These terms affect long‑term costs and are usually reviewed during the conveyancing process.

Budgeting considerations for first-time buyers

When reviewing home‑related costs, first‑time buyers may take into account:

• Mortgage payments and interest rates

• Council tax band and payment structure

• Buildings and contents insurance

• Utilities and communications

• Service charges and ground rent, where applicable

• Ongoing maintenance and household costs

While costs and circumstances vary, having an overview of potential home expenses can support more informed financial decisions.

Explore our range of new-build homes and flats in and around London. We also have plenty of homebuying offers to help you move. Check the terms and conditions to see if you’re eligible.

Call our Sales Advisers to get started today.