Homebuyers are being warned about hidden purchase costs that can run into thousands of pounds if they rush to buy without checking out properties fully first.
It comes amid a Covid property mini-boom that has seen buyers pile into the market as they shrug off economic uncertainty and social distancing.
A survey by property website Zoopla suggested that 39 per cent of buyers last year were stung by hidden costs – with some coming from unexpected bills for things that could have come up on a full survey, or items such as boilers that could have been checked up on.
Caution! Homebuyers are being warned by experts about hidden purchase costs
With the additional incentive of a stamp duty cut, the extra buyer demand has helped to push up prices to record levels.
Meanwhile, buyers are feeling the pressure to act as the average time it takes to sell a home has dramatically shortened.
But amid the Covid housing recovery, experts are adding a word of caution about rushing into a purchase without doing your research properly.
Buying a property without due diligence can be a costly mistake, with buyers having to cough up four-figure sums for items they’ve overlooked.
This has included £3,000 for a boiler that one buyer thought was working perfectly well when he viewed the property.
A survey by property website Zoopla suggested that 39 per cent of buyers last year were stung by hidden costs.
Of these who were, 29 per cent said the costs were standard transactional services, such as surveyors and conveyancers.
However, there were still other unexpected costs, which vary with every home.
A total of 44 per cent of those who had been hit by hidden costs said they ended up paying more than £500, 30 per cent said they paid more than £1,000, and 15 per cent said they paid more than £1,500.
One buyer paid £3,000 for a boiler he thought was working when he viewed the property
Tom Parker, of Zoopla, said: ‘While it does make financial sense for many to bring forward their purchasing plans and make the most of the stamp duty holiday, the importance of due diligence cannot be underestimated.
‘It’s always worth investing in a thorough surveyor and budgeting for any additional costs that may come up as a result.
‘Skimping now could cost you thousands later on. Moving house always has its stressful moments and financial worries are an additional burden that no one needs.’
It comes as Nationwide revealed that house prices have just hit an all-time high, with the average home costing £224,123.
It is 3.7 per cent higher than prices last August. And last month, prices rose an impressive 2 per cent – the biggest monthly jump since 2004.
In addition, August was the housing market’s busiest month for more than a decade, with the highest number of homes put up for sale since 2008, according to property website Rightmove.
With such high activity in the market, it is important that purchasers don’t overlook steps in the buying process, such as instructing a surveyor.
North London estate agent Jeremy Leaf said: ‘Renewed activity and competition in the housing market shouldn’t tempt buyers to go ahead without instructing a survey.
‘Even though the market is busy, and you may be eager to make an offer to get in ahead of the competition, you shouldn’t ever lose sight of the importance of having a survey.
‘It is always best to go into a purchase with your eyes open or you may make a costly mistake which could have been so easily avoided, and will have to be rectified further down the line.’
Hidden costs: A new boiler cost me £3,000
Robert Steadman had extra costs of £3,000
One buyer who was caught out by hidden costs is Robert Steadman, 49, a software developer.
He had a budget of between £320,000 and £350,000 for his new home in Great Linford, Milton Keynes, but wound up paying some additional costs for a new boiler.
He explained: ‘Prior to purchasing my home, I had a survey carried out which flagged a warning on the boiler and gas installation in the property.
‘Essentially, the system was not running at the time of the inspection and no assessment was made – although the surveyors said that they saw no areas of concern.
‘As I didn’t want to delay and potentially jeopardise the sale, I took no action on this and put it down to my surveyors being overly cautious. However, in hindsight, the boiler was quite old and hadn’t been running when I viewed the house – although, the radiators were hot so I assumed the boiler must have been working.
In hindsight, I would have thoroughly investigated my concerns around the boiler and gas and haggled more on the price
‘Unfortunately, within a month of moving into my property, the boiler was leaking and a gas engineer who came to visit the property informed me that I would have to make changes to the layout too as it no longer complied with regulations.
‘Overall, installing the new boiler cost me around £3,000 and definitely was more costly than I anticipated. In hindsight, I would have thoroughly investigated my concerns around the boiler and gas and haggled more on the price. The positive side is that since it was resolved after I moved in, I now know that it was done properly and legally by a reputed firm.’