Working out how much it will cost to buy and sell property is best calculated at the very beginning to prevent unplanned financial surprises
Buying and selling property is one of life’s most fulfilling – but expensive - milestones. There are costs involved at almost every transactional step, especially if you’re buying and selling in tandem. If you’d like more in-depth advice about home moving finance, Open Property has a dedicated online financial advice section but to help with your initial budgeting, here’s our ‘what to expect’ guide, with average figures:-
Estate agent’s selling fee
When you sell a property, the estate agent working on your behalf will charge for its service. This fee - known as commission - is expressed as a percentage of the value of the property they are selling, and the average percentage is thought to be around 1.5% but it can be much higher (in excess of 3%). For example, the purchase of a house worth £233,000 would incur an agent’s bill of £4,660 at a fee of 2%. With Open Property, you can sell without an estate agent and without the associated costs.
Selling your property can incur a number of unexpected fees and these can quickly mount up. All homes for sale need to have an Energy Performance Certificate (EPC) – costing anywhere between £50 and £150, while Royal Mail’s post redirection service will set you back almost £40 for three months for a single occupant.
Purchasing a property almost always comes with an extra price tag in the form of stamp duty land tax (SDLT). This fee is paid upon completion by the purchaser and is expressed as a percentage of the property’s value. The table below shows how the tax is calculated for those who are selling one property to buy another:
|Home movers: property value||SDLT|
|Up to £125,000||Zero|
|The next £125,000 (the portion from £125,001 to £250,000)||2%|
|The next £675,000 (the portion from £250,001 to £925,000)||5%|
|The next £575,000 (the portion from £925,001 to £1.5 million)||10%|
|The remaining amount (the portion above £1.5 million)||12%|
Those who already own a property and are making an additional purchase – for investment or as a holiday home, for example – pay an additional 3% on top of the above SDLT rates.
First-timer buyers have special SDLT rates, as below:
|First-time buyers only: property value||SDLT|
|Up to £300,000||Zero|
|Between £300,000 and £500,000||5%|
Purchasing a property involves putting down a cash deposit and this is usually the buyer’s biggest expense. Expect to pay between 5% and 15% of a property’s value at exchange, although larger deposits are advisable as they will secure the best mortgage rates. For illustration, the average first-time buyer deposit in the UK is in the region of £46,187 but this figure tops £100,000 in London.
Buying & Selling
As buying and selling property is a legal transaction involving hundreds of thousands of pounds in assets, a conveyancing solicitor is vital. The average conveyancing fee to purchase a freehold home is around £1,040, and approximately £1,000 to sell (based on a property worth £232,797 and including 20% VAT).
Mortgage arrangement & survey fees
If you need a home loan to purchase a property, the lender will probably charge you for arranging the mortgage. Arrangement and set up fees average around £1,000. Don’t forget to add in the survey fee too – expected to cost in the region of £400 to £1,000, depending on the size, value and condition of the property you are buying.
As well as the cost of buying packing materials, such a boxes and bubble wrap, moving costs will increase if you employ a professional firm to complete the daunting task of moving your worldly goods. The expense will increase if you request the company to wrap and pack on your behalf. Expect to pay between £300 and £1,500 for a professional move, depending on the level of service chosen, the size of the property and the distance you are moving.
How to save £1,000s and sell your house fast
While some of the above fees – such as SDLT and a deposit – are unavoidable, you can drastically cut your moving bill by choosing to sell to Open Property. We don’t charge agency fees or clearance costs, and there are no legal bills as we don’t require you to appoint a solicitor.
In addition, we buy any property whatever the condition, so there’s no need to spend on DIY or decorating to get ready for market. If you’d like an instant offer and cash in your bank account within 48 hours of completion, contact Open Property today.
Watch the video below which explains more about selling your property fast or click here to continue reading this article