When it comes to the cost of moving home, selling up can be more expensive than some people realise. There are many additional costs incurred during the moving process – other than the cost of the house – that will need to be budgeted and accounted for. If you’re thinking of moving home soon, you may find it useful to read through our three-part guide to the cost of moving home, including all the upfront and ongoing expenses you should expect to budget for, both before and after you move.
1. The deposit: 5%+
Unless you are a cash buyer, by far the biggest sum of money you will need to pay if you are getting a mortgage, is the deposit. The minimum deposit required for a house purchase in the UK is typically around 5% – whether you are arranging a standard mortgage or using a government scheme, such as Help to Buy.
In most cases, you will get a lower interest rate based on the size of your deposit. The larger the down payment, the lower the interest, so it’s worth saving up and laying down as much as you can.
2. Valuation charges: £200+
If you are applying for a mortgage, your mortgage lender will need to value the property you’re buying to ensure that it will provide adequate security for the loan.
Not all lenders charge for valuations – they are sometimes included in your mortgage deal – but if you do need to pay, the valuation fees are usually based on the value of the property. Example: A £300,000 home will typically incur valuation fees of about £200.
3. Mortgage arrangement fees: up to £3,000
Some lenders also charge a fee for arranging a mortgage.
Again, this varies according to the lender and the mortgage deal, ranging from nothing to several thousands pounds.
If you do have to pay fees, they could potentially be added to the cost of your mortgage, but you will of course have to pay interest on them if they are, so it is worth shopping around or paying up front if you can afford to do so.
4. Conveyancing and solicitor fees: £2,000+
Most people hire a solicitor to do all of the legal stuff – aka conveyancing – that you need to do when buying a house. This includes drawing up contracts, dealing with land registry, performing searches, arranging stamp duty and transferring payments.
Solicitors fees vary, some solicitors charge by the hour, whilst others have a fixed fee or charge a percentage based on the price of your property. As a guide, you should allocate around £2,000 for this service – and we recommend that you get a few quotes before you begin.
Some people question the necessity for searches but they are important as they help you to ensure that there aren’t any planning issues – like new developments or road building scheduled nearby – that could impact your new home. They also include checks that there are no potential problems with rights of way, environmental concerns or clauses affecting the property. The price of the searches is generally included in the fee and as long as they don’t identify further problems which need sorting, then they should cost no more than £300.
That’s all for part one, come back next week to find out what else you’re going to have to pay up front when you move, including the cost of removals and storage.
How much do removals cost? Why not get in touch with us for a free, no obligation quote either via our quick quote service, or our more detailed online estimation service. If you’d prefer to chat face to face, rather than filling in a form then give us a call on 01308 423939 instead and we can take it from there.