New research by TV property gurus Kirstie Allsopp and Phil Spencer has revealed that UK home hunters overspent their combined budgets by a staggering £3.7 billion last year, despite falling house prices and what should be a buyer’s market.
The survey of 2,000 home buyers, announced to coincide with the launch of the new iPhone app ‘Kirstie & Phil’s House Hunter’, has revealed that almost half (49%) blow their budget on average to the tune of more than £10,000.
For 10% of home buyers the situation is more extreme, with finances stretched to cover an additional spend of up to £50,000, while for a frivolous few (2%) it topped the scales at more than £100,000.
Although some buyers are happy stretching themselves financially to secure their dream home, the findings have revealed that, for many new home owners, the overspend in property purchase price is often unplanned and sometimes unexpected. One in five buyers (20%) admit to getting caught up in the excitement of the moment, letting their heart rule their head, while 10% don’t factor in the cosmetic work required to make their new house a home. A similar number (11%) are caught out by the level of legal and estate agent fees they need to build into their buying budget.
Stamp duty is another major issue, with more than half of house hunters (58%) saying they are clueless as to the level they are required to pay when shopping and budgeting for their new home.
In response to the findings, ‘Kirstie & Phil’s House Hunter’ app, available from iTunes, allows buyers to search across thousands of UK properties while being guided through every stage of the house buying process, from searches and viewings to making an offer and closing the deal.
House Hunter is packed with videos and audio tip guides from Kirstie & Phil and contains chapters including a definitive guide to finance, mortgages, dealing with agents, legal processes and exchange and completion.
Kirstie Allsopp says, “Going over your intended budget isn’t always a bad thing if it means getting your dream home for a price you can still afford. However with house prices as low as they are at present it should be a buyers market, and so it’s worrying to hear how many people are spending too much either because they’re not striking a deal or because they’re not on top of their finances.
“Factors like estate agent fees and stamp duty will leave a serious hole in a budget if they’re not prepared for and it’s staggering to find out how many people are being caught out.”
Another significant reason for the overspend seems to be the fact Brits aren’t good at bagging a bargain; a staggering 40% of all buyers said they offered the asking price for their home without entering into any negotiation.
Phil Spencer adds, “We know from helping hundreds of people through the buying process that the same problems and pitfalls arise time and time again and that’s why we’ve created the app. It’s the first to combine an extensive property search function with great tools to help buyers manage their individual search, from tracking and scoring viewings, calculating finances and doing the deal to managing the move. As such we hope it will go some way to keeping the process stress free for house hunters, as well as on budget.”