Research finds younger buyers least prepared for the true cost of getting on the property ladder
UK homebuyers face more than £1,800 in unexpected costs, according to research by major financial services group Legal & General (L&G).
Beyond the deposit, buyers reported spending an average of £1,836 on costs they had not anticipated. That figure climbs to £2,041 in London and £2,033 in Belfast, pointing to significant regional variation in financial pressure.
The L&G study identified a substantial gap in financial awareness between age groups. While 45% of those aged 55 and over said they were familiar with all moving costs, that proportion fell to just 12% among young millennials aged 25–34, and 14% among Gen Z respondents aged 18–24. Among young millennials, 40% said utility bills were higher than expected once they moved in.
Understanding mortgage products poses a further obstacle. Almost a third of respondents struggled to distinguish between different mortgage types. Among 25–34-year-olds, 39% found equity-related terms confusing, and 38% said they did not fully understand what an Agreement in Principle entails.
By contrast, 39% of those aged 55 and over reported a clear grasp of mortgage concepts. Confusion was most pronounced in London, where higher proportions of respondents reported difficulty with fees (38%), equity (36%) and mortgage types (35%).
Despite those pressures, 63% of respondents said they felt confident when purchasing their first home, including 20% who described themselves as very confident. Confidence was highest among 25–34-year-olds (71%) and lowest among those aged 45–54 (53%). Regionally, it peaked in the East Midlands (69%) and was lowest in Northern Ireland (56%).
The survey of 2,000 UK homeowners also found that nearly half (48%) regard moving house as the most stressful life event — ahead of divorce or the breakdown of a relationship.
Once in their new home, buyers most commonly took out buildings insurance (67%) and contents insurance (61%). Life insurance was arranged by fewer than four in 10 buyers (38%), while income protection (20%) and critical illness cover (18%) were less common still.
"Buying your first home is a major milestone, but our research shows it can feel overwhelming, particularly when faced with unexpected costs and unfamiliar mortgage terminology," said Clare Beardmore (pictured right), director of Legal & General Mortgage Club.
"That's where advisers play such a key role in helping buyers navigate the homebuying process with confidence, ensuring they make informed decisions when arranging a mortgage and have the right protection in place."
Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, X (formerly Twitter), and LinkedIn.
