If you’re thinking about buying or renting a home for the first time, figuring out how much it costs to keep the lights on—literally—can feel like a minefield. Many people get a nasty shock when the first bills roll in. To help you plan, we’ve broken down the key household costs if you are living […]
Lisa Best
12 December 2024
Table of Contents
If you’re thinking about buying or renting a home for the first time, figuring out how much it costs to keep the lights on—literally—can feel like a minefield. Many people get a nasty shock when the first bills roll in. To help you plan, we’ve broken down the key household costs if you are living in the UK and added some tips to save where you can.
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This will likely be your biggest expense. According to the Office for National Statistics (ONS), the average house price in the UK in November 2024 was £267,200. In 2025, with the average UK house price at £267,200, a 10% deposit (£27,720) and a 4.5% mortgage interest rate, your monthly repayments over 30 years would be around £1,218. Renters might pay slightly less or more, depending on location. According to Zoopla, the average UK rent is £1,245 per month.
💡 Tip: If you’re buying, explore fixed-rate mortgages for predictable payments, especially in volatile interest rate markets. Renters? Read the fine print on contracts for unexpected fees like maintenance costs.
Council tax varies depending on your property’s band and location. Most councils let you spread payments across 10 or 12 months. If your home has been extended, it might fall into a higher band—something to check before you move in. According to gov.uk, the average council tax per dwelling was £1,668 in 2024-25. In comparison, the average council tax per dwelling was £1,578 in 2023-24. A similar increase of 5.7% woud make 2025/26 bills around £1,763.
💡 Tip: Discounts exist! Single occupants, students, or people with disabilities may qualify for reduced rates. Always check with your local council.
Energy costs are high, and while many homes have improved insulation, older properties might not be as efficient. Smart meters are standard in most homes, so you can track your usage in real time. According to Nimblefins, the average gas and electric bill in the UK in early 2025 for a typical household with will be £152 per month.
💡 Tip: Keep costs down by timing your heating, switching to energy-saving appliances, sealing draughty windows and even adding curtains to keep heat in. A little effort can save a lot over time.
Water bills are unavoidable, and you can’t switch providers like you can with energy companies. Charges are based on your property’s size or a water meter. According to United Utilities, their expected average household water bill for 2024/25 was £481, an increase of 7.9 per cent compared to 2023/24 charges. If there is a similer increase in 2025/26, the average bill would be around £43.20.
💡 Tip: Install a water meter if your home has fewer occupants than average—it could save you money. And skip running the tap while brushing your teeth!
Lenders will insist on buildings insurance, and contents insurance is a smart idea to protect your belongings and it will be difficult to get a mortgage without it. When renting. Your landlord will likely have landlord insurance, but this will not cover your belongings, therefore it may be worth getting tenants insurance.
In order to help you along, we have done some research on home insurance quotes for a property with a rebuild cost of £266,000. We looked at 10 policies, woith an excess of £150 and contents cover of £25,000, with the average cost being £15.82 per month.
Remember, it is importnat when getting any policy to make sure you are covered for what you need. Most policies offer various options such as legal cover, accidental damage, home emergency cover and even lock cover, so be sure to check the detail before committing.
💡 Tip: Bundle policies or use comparison sites to snag a better deal. Some insurers offer discounts for additional security features like smart locks or alarms.
With streaming, remote work, and connected devices, reliable Wi-Fi is non-negotiable. Prices vary depending on the speed and provider and can range from £25 to £60 for high speed connections. Uswitch states that ‘many broadband customers could see a bigger price increase in 2025 than they did this year, despite Ofcom’s recent introduction of a ban on inflation-linked price rises’. Using the data from five big providers, the average increase expected in 2025 is around £436.18 per year, an increase of 9% year on year.
💡 Tip: Haggle! Many providers give discounts to loyal customers or new sign-ups. Don’t hesitate to negotiate better deals.
If you watch live TV or use BBC iPlayer, you’ll need a TV license. It’s non-negotiable but relatively affordable. The annual cost of a standard colour TV licence will rise to £174.50 from 1 April 2025 – an increase of £5 on the current price of £169.50 a year – the Government has announced.
💡 Tip: If you stream only through platforms like Netflix or Disney+, you might not need a TV license—double-check the rules.
Grocery costs have risen, so planning is essential. The average adult spends around £200 per month, but families of four typically spend closer to £600.
Here’s a list of 15 essential grocery items for a family of two adults and two children, with current Tesco prices (December 2024) and a focus on affordability and balance:
These prices reflect recent trends in the UK grocery market. Rising costs due to global factors have made budgeting more critical for families.
💡 Tip: Meal planning and bulk buying can reduce waste and save money. Avoid daily shopping trips—they add up!
If you need a parking permit, costs can range from £10 to £60 a month, depending on where you live. Off-street parking? Pricier but worth the convenience.
💡 Tip: Check if your area offers discounts for eco-friendly or low-emission vehicles.
If you’re buying a flat, service charges cover maintenance for shared spaces like lobbies and gardens. Ground rent is another common expense for leasehold properties. The Property Institute report an average annual bill of £3,634 per leaseholder for total service charges, an increase of 41% over the last 5 years.
💡 Tip: Always ask about service charges before committing to a property—they can vary dramatically.
Based on a family of four and taking all of the averages above into account it costs around £2,283 per month to run a home.
Rising inflation, energy costs, and food prices are pushing up expenses for households. The good news? Understanding these costs in advance means you can prepare and avoid surprises.
Even if your actual bills differ slightly, these averages give you a ballpark idea of what to expect. Budget carefully, look for savings, and remember—you’ve got this!
Planning your home finances might seem daunting, but it’s all about knowing what to expect. The more informed you are, the smoother your journey into homeownership or renting will be. Happy budgeting!
From mortgages and insurance to viewings, offers, exchange and completion, our Buyers’ Guide will take you through everything, step by step, from start to finish.
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