Everything first-time buyers need to know in 2025 - including the hidden costs when buying a house

Buying your first home is an exciting milestone, but it can also be a maze of new terms, paperwork, and unexpected expenses. At Jacobs Steel, we’re here to help make the journey smoother.

If you’re planning to step onto the property ladder in 2025, here’s everything you need to know, including some of the hidden costs when buying a house that many buyers overlook.

1. Start with your budget – and be realistic

It’s tempting to look at your deposit and assume you’re ready to go. But remember, the purchase price is just part of the story. Your budget needs to include:

Stamp duty (if applicable – more on that below)
Solicitor/conveyancing fees
Mortgage arrangement and valuation fees
Survey costs
Removal costs
And don’t forget furniture and decorating once you’re in!

These are some of the hidden costs when buying a house that can catch first-time buyers off guard, so it’s best to plan early.

2. Understand stamp duty for first-time buyers

The good news? As a first-time buyer in England, you’ll usually pay less stamp duty – or none at all – depending on the property price. As of April 2025:

No stamp duty is payable on homes up to £300,000
For properties priced between £300,001 to £500,000, you’ll pay 5% on the portion above £300,001
If the property is over £500,000, you won’t qualify for first-time buyer relief and will pay the standard rate

Make sure to factor this into your overall costs.

3. Maximise your savings with ISAs

If you’re still saving for a deposit, make use of Lifetime ISAs (LISAs). These accounts allow you to save up to £4,000 per year, with the government adding a 25% bonus – that’s up to £1,000 extra annually. You must:

Be aged 18–39
Use the funds to buy your first home (up to £450,000)
Have the account open for at least 12 months before using it

If you haven’t opened one yet, do it sooner rather than later!

4. Get a mortgage agreement in principle

Before house-hunting, make sure you get a mortgage agreement in principle. This shows sellers and estate agents that you’re serious and ready to proceed. It also gives you a clearer idea of what you can afford.

Remember, different lenders have different criteria – and interest rates may continue to fluctuate throughout 2025 – so shop around and consider using a mortgage broker to find the best deal.

5. Don’t skip the survey

You might think you’re saving money by not getting a proper survey done – but this is one of those hidden costs when buying a house that could actually save you money in the long run. A Homebuyer Report or full building survey can uncover issues that might cost thousands down the line. Even new builds can have defects.

6. Budget for solicitor and conveyancing fees

Legal work is an essential part of the buying process. A solicitor or licensed conveyancer will handle contracts, carry out local authority searches, deal with the Land Registry, and manage the transfer of funds. Costs can vary but usually range between £800 and £1,500, plus disbursements.

Some first-time buyers forget to include this in their calculations — another of those hidden costs to watch out for.

7. Think long term – not just about getting the keys

Beyond the initial costs, think about your ongoing budget. Council tax, utilities, service charges (for flats), buildings insurance, and maintenance all add up. Create a spreadsheet with your estimated monthly outgoings and make sure your mortgage payments are sustainable alongside them.

Buying your first home in 2025 is a huge achievement – and a smart long-term move. But it pays to go in with your eyes open. Understanding the hidden costs when buying a house, taking advantage of government schemes like LISAs, and planning for every stage of the process can help make it a smoother, less stressful experience.

If you’re unsure where to start, the team at Jacobs Steel is always here to help. We’ve guided thousands of first-time buyers through the process and would love to help you do the same. Get in touch today for expert advice, trusted mortgage partners, and properties that are perfect for first-timers.