How Much Does it Actually Cost to Move Home? Look Out for Unexpected Costs...
There are plenty of costs to factor in when you’re putting together a budget for moving house. There will be upfront fees such as stamp duty and legal expenses. There are also costs closer to your moving date, from the removal van to redirecting your mail. Here are the costs associated with moving house to start budget planning.
The cost of moving home can really add up if you're not prepared. There are various fees and outgoings to think about, here is a breakdown of the most significant and when they need to be paid. Bear in mind that costs quoted are exclusive of VAT:
Estate Agent Fees
Most estate agents charge a commission fee as a percentage of the sale price. Fees vary depending on location, in our area of Derbyshire, are usually charged between 1% and 1.5%. This means if you sold a home for £200,000 at a fee of 1%, your estate agent fee would cost £2,000. Some estate agents charge a fixed fee, while you’ll also need to decide whether you want to commit to a sole or multiple agency agreement. The estate agent's fee is usually deducted from any sale proceeds by your legal representative and paid directly to the agent.
Energy Performance Certificate
It is a legal requirement for you to provide an Energy Performance Certificate (EPC) when selling your home. This must be prepared prior to the marketing of your property. This document informs buyers how energy efficient your property is and will cost around £95.
Conveyancing
This is the process of legally transferring ownership of a property from one party to another. You’ll need to instruct a conveyancer or solicitor, and so will your buyer. Conveyancing fees can cost anything between £800 and £2,000. With this in mind, it's important to shop around for recommendations from friends or family and definitely ask your agent if they have any preferred conveyancers. An estate agent will always recommend excellent conveyancers as it helps the whole process go smoothly for all parties.
Removals
When you move, you’ll also need to factor in the cost of removals. You could organise this part of the process yourself, but at the very least you’ll likely need to hire a van. The cost of a professional removal company varies up to around £1,500 at the very top end. It's important to note that Fridays tend to be the busiest days for removals firms so you'll need to get in early if that is your moving day of choice.
Sometimes there is a gap between handing over your keys and moving in to your new home. This means you may need a place to store your belongings for a period of time. Fees depend on how much space you need but can be around £25 to £100 per week.
Renovation
In preparation for selling your home, it’s crucial that it looks it's very best and everything is in good working order. Therefore, you may choose to make some upgrades before going to market. Significant renovations like a new kitchen will cost you in the thousands, while it’s recommended to put a few hundred pounds aside to complete any unfinished jobs or fix anything that’s broken.
Stamp Duty
Stamp Duty is a tax you might have to pay when you buy a new home. Not everyone will have to pay Stamp Duty.
If you're buying a residential property in England and Northern Ireland, you will not have to pay Stamp Duty on the first £250,000 of a property's purchase price.
First time buyers will not pay any Stamp Duty on the first £425,000 of a property’s purchase price and then 5% for any amount above £425,001 up to £625,000. If the purchase price is over £625,000 you will pay Stamp Duty at the home mover rate.
For home movers, the Stamp Duty rates you’ll pay are:
0% - Up to £250,000
5% - £250,001 - £925,000
10% - £925,001 - £1.5m
12% - £1.5m+
These rates are correct as at August 2023. Any changes should be checked at the time of moving home.
Mortgage Fees
If you require a mortgage for any potential new home then fees are often payable.
You will need to provide a deposit to get a standard mortgage for a property. This can start as low as 5%, but a low deposit can make it more difficult to get a mortgage. A higher deposit will often offer a much better chance of obtaining a mortgage. If you’re moving house, you’ll be able to use the equity from your sale to go towards your the deposit on your next purchase.
You’ll may also need to pay any fees to set up your mortgage. These are usually paid upfront or can sometimes be added to the mortgage.
It is a complicated area and our advice is to secure the services of a mortgage adviser to act on your behalf to get the best deal to suit your individual circumstances. At Cope & Co, our recommended mortgage partner is Peak Mortgages.
Home Insurance
Did you know that from the point that you exchange contracts, you become legally responsible for the property? Therefore, it’s recommended that you take out insurance at this point. You can often find good deals on contents and building insurance combined. Costs vary depending upon the individual property but average at around £150 - £300 per year.
Surveys
Not every home will require a survey report. However, it is recommended that you get a building survey if you are purchasing a particularly old property.
Costs will depend on the type of property survey you want:
RICS condition report: £250+
RICS homebuyer report – survey only: £350+
RICS homebuyer report – survey & valuation: £400+
Building survey – £500-£600
New build snagging survey – £300-£600
Each of these will look at different things and your estate agent will be able to advise on which, if any, would be advisable. A survey can potentially save you money further down the line by highlighting any issues. It may also help you negotiate a lower purchase price!
Contingencies and Other Costs
There are likely to be a few unexpected costs that crop up through the selling and buying process, so it is a good idea to put aside some contingency money. Also consider things like mail redirection, cleaning costs etc.
Get in Touch!
If you want more advice on budgeting or more detailed information on the cost of selling your property, get in touch with us today and we can provide you with everything you need. We can also provide you with a full market appraisal to give you an idea of how much your home could sell for in the current market it and how we would market your property to maximise it's sale price.
Please call for me for any advice on selling your home.
