Are there hidden costs when you move house?
Moving house can be a stressful and expensive process – there are always costs to consider when you decide to find yourself a new home. There will even be many hidden costs you might not have considered. It’s important to be aware of them, and to plan ahead, to ensure you have the funds necessary to comfortably complete your move.
So, what are some of the costs you should be aware of when moving house?
You will encounter conveyance fees at some point during your move. Conveyancing relates to the legal process of transferring property. There are certain aspects of a move that require the attention of a specialist, whether it be finalising the terms of your mortgage agreement or transferring the title of a deed, for example.
Solicitors and conveyance experts can help you take care of the legal steps involved in purchasing a property, but they will require a fee for their service. When you reach out to experts for assistance, make sure you get a clear understanding of how their fees break down before you go any further.
When you purchase a property it’s always wise to have a survey completed. There are many different types of survey available, depending on the property that you intend on purchasing. A survey is intended to ensure that you’re familiar with the condition of a property before you actually purchase it.
A surveyor will thoroughly examine the building, and let you know of any potential issues, such as subsidence, damp, or other structural problems. This can help you negotiate the price of the property down further, in certain circumstances, but will always mean you go into the property knowing exactly what you’re getting. This makes surveying an invaluable investment when moving.
Stamp duty is essentially a tax on property and land transactions, and you have to take into account what your new home will require you to pay. Stamp duty is a legal requirement, so it’s not a cost that you can get around. This means it’s important you consider it when you’re budgeting for your move.
Stamp duty is not charged on properties under £125,000. 2% is charged between £125,000 and £250,000. 5% is charged between £250,001 and £925,000. 10% is charged between £925,001 and £1.5 million. 12% is charged on anything above £1.5 million.
Most freeholders will generally appoint a managing agent to take care of any communal areas involved in the sale of a leasehold property. If you are a leaseholder, there will often be a fee to help cover general maintenance and service charges, as well as premiums for building insurance and ground rent.
These are ongoing fees, and there is no standard – it depends entirely on the property you’re moving into, and those fees can vary year on year. Make sure you are familiar with them before moving in, and it’s always prudent to ask if there’s a possibility they will go up in future. This can help you better manage your budget.
Estate agent fees
If you’re moving to a new property, it’s likely you’re going to want to sell your old one. If you choose, as most do, to market your home with an estate agent, there will be fees to consider. These can range from 1.5% to 3.5%, and more, of the property’s selling price – depending on the specific agent and the service they offer.
Make sure you get a clear breakdown of your estate agent’s fees before you agree to list your property with them. Do your research among local estate agents to see who can offer you the best possible deal. Remember that a good estate agent will want appropriate compensation for quality work, so don’t merely be tempted by the lowest possible fees you get. This might put you at risk of dealing with an inexperienced agent, or one that offers a very basic service in return.
This is a more common cost you will encounter, as you will likely need professional help to move your belongings to your new property. It’s worth investing in the service of an experienced and well-regarded removals firm, to help make sure your move is as stress-free as possible, and that your belongings get to your new home unscathed.
There may be extra fees on top to consider, such as additional insurance for special items. Other factors can have a considerable impact on the fee you’re charged too, such as the distance you’re travelling and the amount of stuff you want to take with you. If you choose to move on the weekend, too, this can also cost more.
If you’re moving, you’re going to encounter more costs than just the removals firm – you will also need to prepare your property. For this, you’re going to need things like proper packing boxes, bubble wrap, foam, packing tape, packing peanuts, etc. These things will allow you to complete your move as quickly as possible, without damaging your goods.
Some removal firms offer packing materials as a part of their service – they will provide boxes and so on, as well as help you to pack in certain circumstances. They will generally charge more for this service than if you choose to get the materials and pack your property yourself. You may even wish to simply hire a large vehicle and move your belongings yourself – this can be cost-effective if you don’t have much heavy bulky furniture, but if you do it’s better to leave it to the experts.
No matter how you’re buying your home, it’s likely a large amount of money is going to be changing hands. This can incur an electronic transfer fee from your solicitor for making sure the money gets where it should. There may also be a property fraud fee, which covers the necessary background checks to protect a buyer or seller from fraud. Arranging your mortgage might carry a mortgage arrangement fee payable to your mortgage lender for setting up your mortgage.
VAT will also likely be added to a large portion of the things you buy when you’re moving house – everything from your new furniture to the services of an estate agent. For the most part, these fees and prices will generally be inclusive of VAT, but this isn’t always guaranteed, so be sure to be prepared.
When you arrive in your new home, you’re going to want power, light, and an internet connection. There may be fees involved in setting up your services. For example, if there was no existing phone line, you might encounter costs when trying to set up your broadband service. Not every utility company is going to charge for this, but some do, so make sure you’re aware of those costs as early as possible in your move. This will help make sure that your property is properly supplied with heat, water, and internet when you get there.
Redecorating and repairs
If you’re moving long-distance, it’s possible you haven’t had the chance to examine your new property as much as you might have liked. This might mean when you move in, over your first few days in the home you discover things you’d like to change. Even if you’re not moving far, there’s always the risk that you’re going to find something about the home you don’t quite like. Budget for this in advance, to make sure you have money left to make your home how you really want it.
This can be anything from furnishing it the way you want, making sure that you know whether or not the property comes furnished at all (it sounds obvious, but never presume one way or the other), or even making alterations to the structure. Give yourself some money to play with to make sure you can make any changes you feel you have to.
Working out your budget
These are just some of the hidden costs associated with moving house. It’s not likely you will encounter every single one of these, but everyone will encounter some mix of them when they move. It’s important to be aware what you could have to pay, as the cost of moving involves so much more than simply the cost of the property itself. Whether you’re selling or buying, there are going to be hidden fees lurking that can catch you out if you’re not careful.
The key is to make sure you’re as well informed as possible about the process of buying or selling from beginning to end. Learn what costs you might face, and how much they might be, to give yourself a truer representation of what your budget needs to be. When you have that figure, make sure you leave even more money in reserve. The only guarantee about buying or selling a house is that there will always be an expense somewhere down the line you didn’t anticipate – so always be prepared.« Stamp duty scrapped for homebuyers on properties worth up to £500,000 Losing your job: The survivors’ guide »