Home Purchase Costs Don't End With Getting the Keys

Getting the keys to your home doesn't always mean that the major expenses are over. Furniture, household appliances, and other necessities can add thousands of euros to your home purchase. According to Eneli Nairis, head of small financing at Swedbank, it's worth thinking through what you need in your new home right away and what can wait.

"When moving to a new home, it's easy to want everything ready as quickly as possible. In reality, it makes sense to distinguish between what you need for daily life right away and what can still wait. A bed, refrigerator, or washing machine may be necessary from day one, but a carpet, coffee table, or other furnishings usually aren't," said Nairis.

Expenses can become particularly large when you can't bring much from your previous home. The need for financing depends on what you're buying. For example, kitchen furniture and other permanent home furnishings can be factored into a home loan in certain cases, while a washing machine, television, or other household appliances need to be purchased separately.

When to wait and when to make a big purchase right away?

According to Nairis, gradual furnishing can be sensible both financially and practically. After living in a new home for a while, you often get a better understanding of what furniture or solutions you actually need. It also gives you the opportunity to save money for larger purchases and compare prices.

However, it's not always wise to postpone a necessary purchase simply to save money. If you need several large items at once, it may be worthwhile to purchase them all at once and spread the cost over a longer period. "If, for example, after moving you need a washing machine, a sofa, and a bed right away, a loan can help spread the larger expense over time and still keep a buffer for unexpected costs," said Nairis.

You should also consider the total cost of the purchase. If you can buy several necessary items at the same time or during a sale at a lower price, a purchase made with a loan can provide savings. On the other hand, delaying a purchase can come with other costs – for example, using a laundromat due to a lack of a washing machine or ordering takeout more frequently due to a lack of an essential kitchen appliance. For this reason, it's worth comparing not only the purchase price and loan cost, but also how much the delay in purchasing will actually cost.

"Although purchases made with a loan should be carefully considered, a purchase doesn't always have to mean buying only what's absolutely necessary. Sometimes it can be completely justified to make a desired larger purchase earlier if it makes daily life more comfortable and if there's an opportunity to do so. The important thing is that the new monthly payment fits into your budget and doesn't force you to give up something else important," said Nairis.

In summary, the question isn't whether to furnish your home right away or gradually, but what solution a person wants and what suits them. Sometimes this means waiting and saving, other times it means making a larger purchase immediately. Throughout all this, it's important that the impact of the chosen solution is ultimately positive for the person – that it fits their means, supports daily life, and doesn't create financial stress.