March 15, 2021
What fees are involved when moving house?
“The fees you pay will depend on whether you intend to buy a new house or move to a rental property.”
In this article, we’ll look at both scenarios.
If you’re considering moving to a new home, you’ll want to know how much it’s likely to cost you
Buying a house
When you buy a new property, there are some significant expenses to be taken into consideration:
- Stamp Duty
Stamp Duty is a government tax that you must pay on homes costing £125,001 or more. If you’re a first-time buyer, you won’t need to pay Stamp Duty on the first £300,000 on properties worth up to £500,000.
If you’re buying a property as a second home or a buy-to-let, you’ll have to pay an additional 3% on top of current rates if the property is worth £40,000 or more.
The more you can afford to put aside as a deposit, the more likely you are to be granted a mortgage, and the lower your interest rate may be.
On average, you’ll need between 5% and 20% of the cost of the property to put down as a deposit.
If you’re renting, you’ll need to pay a deposit of around 1.5 times the monthly rent figure. The deposit is intended to cover any damage or breakages that occur during your tenancy. It also covers a month’s rent in case you default on a payment. You’ll also be asked to pay your first month’s rent in advance before you move in.
- Valuation fee
Before you’re offered a mortgage, your lender will value the property. Valuation fees range between £150 and £1,500, depending on the value of the property. Some lenders may waive the valuation fee, depending on the type of mortgage you choose.
- Survey fees
Before you buy a property, you should have it checked over by a chartered surveyor. A survey will highlight any structural issues that you need to be aware of, potentially saving you money in the long run.
Survey fees vary from around £250 to £600, depending on whether you go for a basic survey or a more detailed one.
- Legal Fees
You’ll need to pay a solicitor or licensed conveyancer to do all the legal work that’s involved in buying a house. Fees are around £850 to £1,500, including VAT at 20%.
There will also be local searches carried out, which typically cost around £300.
- Electronic transfer fee
To transfer the mortgage funds from the lender to your solicitor, you’ll need to pay an electronic transfer fee of around £50.
- Estate agent fees
If you’re selling a property, you’ll need to pay a fee to your estate agent for marketing your property. Estate agent fees are usually around 1% to 3% of the sale price, plus 20% VAT.
- Letting agent fees
If you’re moving to a rental property, you’ll need to pay the letting agent to carry out credit checks and referencing on you. These fees vary between agents and also depend on the monthly rent the landlord is charging. Typically, letting agent fees start at around £250.
- Removal company fees
You’ll probably need to pay a professional removals firm to move all your furniture and belongings to your new home. A big removals company could charge up to £1,000 for this service. Although you could hire a van and do the move yourself if you don’t have too much stuff to shift.
A pro removal firm should have insurance in place, but if you plan to move your stuff yourself, check that your house insurance policy covers you first.
- Cleaning fees
If you’re moving from a rental property, you must have it cleaned professionally before you go, including the carpets. If you fail to have the job done correctly, you may forfeit part of the deposit you paid to your landlord.
With this in mind, it pays to pay a professional cleaning contractor to do the work for you. Be sure to get a receipt for the work done so that you can present it to your landlord.
- Post redirection costs
You’ll need to ask the Post Office to redirect your mail for a period after you’ve moved house. This service for UK addresses currently costs £33.99 for the first three months, increasing after that. If you’re moving abroad, the fee will be higher.
- Sundry expenses
In addition to the fees already mentioned, you might incur additional expenses. For example, your pets may need to be put in kennels for a day or two while you move, or you might need to pay extra childcare fees.
Moving home can be a costly undertaking, especially if you’re buying a house. Before you put the wheels in motion, it pays to work out a ballpark figure, showing you just how much the move is likely to cost.
It might be sensible to allow yourself more time to save before you move, rather than stretching your budget.
See how Crystal can help you
As trusted experts, we offer clear, straight-forward financial guidance and policies.