More than half of first-time buyers found day-to-day costs and maintenance bills higher than expected after moving into their new home – leaving one in five of these new property owners facing financial problems.
The research has been carried out by the Money Advice Service, which is a free government-backed initiative.
Although nine in ten first-time buyers considered the cost of council tax before moving in, only two in three accounted for broadband or satellite TV, and less than four in ten considered travel costs.
Of those who underestimated their running costs, 15 per cent didn’t consider budgeting for electricity and gas, while a third regretted not properly budgeting for additional costs. Meanwhile, 48 per cent didn’t take into account the cost of on-going maintenance and repairs.
Fewer than half of all recent first-time buyers have considered taking out a protection policy, such as life insurance or income protection.
New rules to increase consumer protection and encourage responsible lending are being introduced in April. Lenders will look more closely at outgoings as well as income to ensure that borrowers do not overstretch themselves.
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