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Week 3 – Setting Up Your Budget

When you’re thinking about buying your own property it is important that you consider all of the additional expenses that come with home ownership:

  1. Mortgage
  2. Gas and Electric
  3. Water
  4. Council Tax
  5. Insurance
  6. Television Licence
  7. Phone and Broadband
  8. Food
  9. Parking Charges
  10. Home Repairs and Maintenance
  11. Personal Expenses

Please note: All of the figures discussed in this blog are estimated and can differ from your own bills. The location and value of your property combined with the number of residents will affect the overall figures.

  1. Mortgage

Your monthly mortgage payments will primarily go towards repaying your mortgage loan and partly to cover the accumulating interest. As you pay back your mortgage loan your Equity increases, this is the difference between the value of a property and the amount still owed.

Cost: Estimated to be £700 per month however this is likely to be more or less depending on where in the UK you buy your property.

  1. Gas and Electric

Your Gas and Electric bill will cover the cost of powering your home and keeping it cosy and warm – very important.

Cost: This varies from month-to-month however it is estimated at £100 per month per a 2 person household.

  1. Water

Where you live and the availability or water in your area will determine how much your Water rates will cost per month.

TOP TIP: Do you have fewer people living in your home then there are bedrooms? The amount of water you actually use day-to-day will only affect your bills if your property is fitted with a water meter – so you could save some money per month if you get one fitted.

Cost: The average Water and Sewerage bill is £405 per year.

  1. Council Tax

All properties are classified in Bands ranging from A-H and the price you pay per year is determined by the value of the property and which Council Tax Band it is in.

Cost: Estimated around £150 per month however it depends on the property’s Council Tax Band.

  1. Insurance

There are three important types of insurance you need when you are buying a house and these are Contents Insurance, Buildings Insurance and Life Insurance. Contents Insurance covers the cost of replacing your belongings if they are damaged, destroyed or stolen. This type of home insurance is not compulsory however it is advisable.

Buildings Insurance covers the cost of repairing damage to the structure or your property. This type of insurance is compulsory and you will need to have a policy in place from the date you exchange contracts otherwise Mortgage Lenders will not give you a home loan.

Life Insurance is a little different than the other two insurances. It is a form of insurance in which an individual makes monthly or yearly payments to an insurance company and in return they will receive a sum of money after a period of time, or to their family if they die.

Cost: Estimated around £160 per year depending on age and insurance provider.

  1. Television Licence

If you plan to watch or record live TV either through your television or website then you will legally need to purchase a Television Licence.

Cost: Approximately £150 per year.

  1. Phone and Broadband

Most Internet providers insist you get a landline telephone alongside your Broadband however some companies now offer Broadband-only policies.

Cost: Estimated around £25 per month depending on your property’s location and which Broadband speed you want to choose.

  1. Food

Because we all gotta’ eat!

Cost: Estimated around £100 per person, per month.

  1. Parking Charges

You may need to budget for a residential parking permit if your property does not include a garage, driveway or free on-street parking.

Cost: Estimated around £48 per year however it depends on the Vehicle C02 Emissions Tax Band, your property’s location and how many permits are required per year.

  1. Home Repairs and Maintenance

It is advisable to have some money set aside for Home Repairs and Maintenance. Whether it’s a boiler replacement or cosmetic upkeep, you’ll need to be able to cash flow the costs of repairing and maintaining your home.

Cost: N/A

  1. Personal Expenses

And last but not least… don’t forget about your regular monthly expenses (they don’t disappear). These may include your phone bill, fuel for your car, monthly subscriptions, debt repayments, Sinking Funds, Gym membership and personal spending money.

Cost: N/A


Good luck Buyers!


This post is a part of a #weeklywins series hosted by @Lottiebudgets and @CharlotteMusha (Follow us on Instagram)

For more tips visit CharlotteMusha.co.uk

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