A guide to the costs when buying a property
Buying a property, especially for first-time buyers, is a big undertaking and its one thing to source the funds to cover the price of your dream property. But don’t forget, what about all the extra costs?
Being in the know when purchasing a property can really help speed up the process and will make the whole thing a lot less stressful. It’s said that nearly a quarter of first-time buyers have no idea on the added costs they will incur when purchasing a property, have a read below to put yourself in the know and of course, if you have any questions then don’t hesitate to get in touch with our office, we’ll be happy to help.
Searching for and buying your dream property
Luckily searching for and buying a property is completely free of charge and only requires time to find your dream property. However, employing a property search agent to find a property, negotiate a price and complete the sale on your on your behalf is being coming more common. You can expect to pay the property search agent around £500 and a commission of between 1-2% if the sale completes.
This is also known as conveyancing, which is the legal transfer of a property from one owner to another. The cost can vary, but you should allow from around £600 to £1,000. It’s always best to get quotes from multiple solicitors before you ask a solicitor to do any work.
A good solicitor is worth their weight in gold.
If you’re financing your property purchase through a mortgage then the lender will need someone to value the property to make sure it’s worth the amount they’re lending you. Typically this will cost you from £125.
House surveys will help you find out the condition of the property and, if there are problems, give you a powerful reason for negotiating the price down or ask the seller to fix the problems before you move in. There are a few types of surveys to consider, the most popular being the homebuyer’s report which is suitable for most modern and some older properties. There is also a basic survey called the ‘Condition report’, which is useful for a modern house in good condition to provide reassurance if you want to double check everything is ok. The other and more thorough survey is the ‘Buildings survey’, this is ideal for older or unusual properties, or one that’s in a poor condition.
The figures below will give you a rough of idea of what to expect.
|£150 – £300
|£250 – £600
|£500 – £1,000
A ‘search’ is when your solicitor (also known as your conveyancer) requests information from the local authority to confirm that there is nothing unusual or untoward, such as rights of way, environmental, water, or clauses linked to the use of the property.
Costs are generally included in the solicitor’s fee, and unless there’s something seriously amiss or time-consuming you can expect to pay anything from £300.
Your property has to be registered with the Government’s Land Registry. A small fee is charged, depending on the value of your property. To help you work out what you’ll pay, Land Registry provide a fee calculator.
You will have to pay your lender a fee to cover the cost to set-up your mortgage, this can be paid at any point before the mortgage starts. The cost will vary tremendously. It could be a cash amount, or could be a percentage of the mortgage you are applying for, because of this it’s difficult to provide an idea of how much it might cost.
Moving to your new home can cost anything from £50, to hire your own van, to a couple of thousand pounds depending on things like the size of house and your specific requirements. The cost is generally based on the following factors:
Volume – overall volume of your belongings to be moved, usually in cubic feet. This is important as firstly, it determines the size of vehicle required for your move, secondly, the time to take a crew to pack/wrap and load your belongings and lastly, the packing materials required for your move.
Access – The access to both properties, for example, how close a lorry can park to your front door, or whether there is any lower bridges or tight lanes to get to a property. This determines the size of vehicle required and whether any shuttle vehicles is needed should access be tricky.
Distance – This determines the cost for transporting your belongings between both destinations.
Services – The additional services you require, these are generally optional. For example, full or part packing, handyman services or dismantling of items.
Special care – this is items that might require more protection for example crating for antiques or extra wrapping for highly sentimental items.
Special handling – This where items might need special handling for example, being removed via a window, overweight items require crane’s or special lifting equipment, etc.
Costs will also vary between moving companies depending on the level of service they provide.
You have to pay Stamp Duty Land Tax (SDLT) if you buy a property in the UK over a certain price. This is applicable on all purchases of houses, flats and other land and buildings. The amount of SDLT buyers pay varies depending on the price of the property, prices fall within a band group and you have to pay the tax (in percentages) related to that band.
|Purchase price of property
|Rate of SDLT (percentage of the total purchase price)
|£0 – £125,000
|£125,001 – £250,000
|£250,001 – £500,000
|£500,001 – £1 million
|Over £1 million – £2 million
|Over £2 million
The above table is accurate as of October 2014. All information in this article was correct at the time of publication and is provided in good faith.