How Much Does It Cost To Move House When Buying?

House and tree made from sticks of chalk and coins

 

If you’re thinking of buying a house, you may already be aware of how many hidden costs are involved. Most buyers are aware of basic charges such as those for estate agents, but many are surprised by the amount of fees, taxes, and services that will also have to be accounted for.

 

At Britannia Ryans we make it our business to ensure there are no shocks on moving day and in this spirit, we thought we would outline for you the costs and potential financial pitfalls of buying a house, so that you can be prepared for any monetary surprises that may occur.

 

Well, we know if you are looking to buy a house, you are probably already in a rush so let’s get right to the figures...

 

Estate agents fees

You don’t have to use the services of an estate agent to sell your current home, but they can be worth the extra expenditure if it means they sell your home more quickly for you. They usually charge anything between 1 and 4%, though average charges are most often between 1 and 2%. This charge will obviously increase if you use multiple agents, but in turn your property will also be more visible for potential buyers.

 

Mortgage deposit

These days, mortgage lenders nearly always require a deposit in order to lend you money to purchase your new property. This is usually between 5 and 20% of the purchase price. The more of a deposit you can provide, the easier it should be to get a mortgage and additionally, your monthly repayments should be lower.

 

Mortgage fees

Unfortunately, mortgages tend to include many separate fees which, while relatively small on their own, can soon add up to a lot.

 

Depending on your lender and mortgage, you may need to pay a booking fee, which is usually between £100 and £250.

 

You may also be asked to pay an arrangement fee which could be anything up to around £2,500. This amount can be tacked on to the end of your mortgage, though bear in mind that if you opt for this, you will have to pay interest on this amount.

 

You will most likely have to also pay an account fee. This is a fee charged to you by the mortgage lender for setting up or closing down your account and usually costs between £100 and £300. It is more common however for this fee to be charged if you decide to leave the mortgage early.

 

If you are borrowing a large percentage of the value of your property from the lender, they may insist on a higher lending fee which protects them if you default on your payments. Most often the fee is about 1.5% of your total mortgage amount.

 

Survey fees

Mortgage lenders will demand that your property undergoes a valuation before they approve your mortgage. You can opt for only this valuation or home condition survey to be conducted, or you can request either a homebuyer’s report or a full structural building survey, depending on how much you need to find out about the condition of the property’s structure.

Valuations or basic surveys usually cost between £100 and £300, but are sometimes paid for by the mortgage company as part of your mortgage.

Homebuyers reports include the valuation fee, but will also provide more details about the property and tend to cost around £500.

If your property is particularly old or if you are unsure about it’s condition, you should opt for a full structural building survey, which can cost anything up to £1,000.

Stamp duty

Stamp duty is a land tax which is calculated based on the value of your property. Current stamp duty threshold charges are set as follows:

 

Up to £125,000 - 0%

£125,000.01 to £250,000 - 2%

£250,000.01 to £925,000 - 5%

£925,000.01 to £1,500,000 - 10%

£1,500,000.01 and above - 12%

 

Bear in mind that you have to pay the charge for each band that your property falls into, so for example on a UK averagely priced £275,000 property, you would pay nothing for the first £125,000, 2% on the amount between £125,000.01 to £250,000 (£2,500), and 5% on the amount above £250,000 (£1,250). So in this example the stamp duty would cost £3,750, which is effectively 1.36% of the price of the property.

 

Legal fees:

Once your mortgage has been approved and the wheels are in motion, you will need to hire the services of a conveyancer or solicitor to help you with all the legal paperwork, such as local checks and searches, that has to be completed before you can proceed. The charges for these local searches and the resulting legal fees can cost anywhere between £750 and £1500 plus VAT at 20%.

 

Electronic transfer fee:

Your mortgage lender will probably charge you for transferring the mortgage amount from themselves to your solicitor. The cost for this is usually between £40 and £50.

 

Removals costs:

You can of course opt to move your possessions yourself, which is obviously cheaper but also considerably more challenging. Another option would be to hire a van, but the most stress-free and safe option is to hire the services of a dedicated moving company. Aim to find a removal company which is a member of the BAR and is local to you. Prices tend to range from £300 to £2,000 depending on the size of your property.

 

At Britannia Ryans, we are members of the BAR and have over 30 years of residential and corporate removals experience. Our professionally trained packers and movers provide local, national, European, and international removals services from our base in London. We offer safe and secure storage facilities, vehicle and car shipping, and a range of specialist moving boxes and packing materials for sale.

 

Buildings insurance

In order to be granted a mortgage, you will need to ensure you have buildings insurance which protects your property from fires and floods etc. Certain mortgage lenders will charge you if you take out insurance with a company besides themselves, although you are of course free to do so.

 

Contents insurance:

It is highly advisable to ensure that you have contents insurance for your property so that your possessions are covered if they are stolen or damaged etc.

 

Life insurance:

Certain lenders will require that you take out life insurance, though it does not have to necessarily be with themselves. This is their way of recouping their loan if you happen to pass away before you have paid back the full loaned amount.

 

Leasehold ground rent and service charges

If you are moving into a leasehold property, you will be required to pay service charges and ground rent to a landlord who owns the freehold. The ground rent is most often set at around £50-£100 and is paid annually. Service charges however can become expensive, depending on the type and condition of the property and the number of contributors. Always make sure you are fully aware of these costs in advance.

 

Council tax

If everything goes well with your mortgage and house move, the next cost you will need to factor in is that of council tax. Pricing is set in bands according to the size of your property, ranging from the smallest, A to the largest, H. You will be charged based on the band your property is in and also its location.

 

Maintenance and repairs

So now you think you have paid for everything and you are ready to move into your new home?

 

Almost but not quite! Unless you are very fortunate, there are likely to be repairs that need fixing and ongoing maintenance costs, so make sure you budget for these also. For example, the last thing you want to do is move in after all this work and not even be able to have a shower!

 

We have listed the possible costs that you may incur when buying and moving house, but please bear in mind that not all of these will necessarily apply to you, depending on your situation and your particular mortgage deal.

 

So, hopefully you are now fully prepared for buying your new home. If you need any assistance, would like to find out about our storage costs, a removals quote or anything else whatsoever, please fill in the QuickQuote form to the right of this page, request a free pre-move survey, email us at britannia@ryansmove.co.uk, or call us on 0208 803 5151.

 

If you found this article interesting, you might like to view our other related articles:

 

The Ryans Removals Ultimate Moving Checklist

 

10 Of The Most Affordable Areas To Live And Buy In London

 

Why 2015 Is The Year To Get On The Property Ladder

 

Date: 
Wednesday, April 29, 2015
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