Wednesday, 18 May 2016

Five additional moving costs you need to take into account when saving for a home


According to research by Post Office Money and the Centre for Economics and Business Research, the cost of buying a home has leapt by 59% in a decade. That is not just an increase in the costs of the buildings themselves, but a reflection of how moving costs themselves have increased.

The report, featured in The Telegraph, found that costs in 2004 came to £7,475 but had increased to £11,894 by 2014 – a leap of around double the 29.4% growth in living costs in the same period. So what exactly are the costs to watch out for? Here are five of the most common.

*Stamp duty
The stamp duty rules changed considerably after the 2014 Autumn statement. Before that a ‘slab structure’ was in place, with buyers paying a rate of the purchase price. Since then buyers pay a percentage of the price on any property costing more than £125,000, which will cut the value for many buyers (although not all). To find out exactly what you will pay use the MAS stamp duty tool, and remember that if you’re saving for a second home as an investment you’ll have to pay an extra 3% on top.

*Surveyors
An essential part of the process if the home you are buying is of a certain age. A basic condition report survey for a modern home may cost £150-300 but is essential for you and the mortgage lender. However, a homebuyers’ report which will highlight surface level problems such as necessary repairs and damp, will cost more (£350+). And a Building Survey, looking at advanced structural issues, might cost around £1,000, depending on the size of the building. However, it could save a lot of heartache if it identifies severe issues.

*Bank transfer fees
Local news sites regularly report on the ignorance of potential homeowners of the fees that are present when buying a home, and one of the most common areas of surprise is bank transfers. We assume that since we live in the technological age of 2016 the transfer of money really shouldn’t cost anything, and admittedly fees of £30+ (depending on the bank or building society used) are not huge – but they can soon add up.

*Conveyancing
You’ll need a solicitor or conveyancer to carry out the legal work when buying a home, and the fees can be pricey. Taking into account the local authority searches to ascertain who looks after local footpaths and relevant planning issues (£2-300), and setting up the actual mortgage itself, you could be looking at £1,500-2,000 in total.

*Removals

Removal costs depend on a large number of factors, including the distance to be travelled and the volume of items to be moved. Other points that could alter the price include moving during peak times (summer holidays, weekends etc) and movement of any precious items. You can save some costs by moving some objects yourself in the car, but items such as sofas and white goods are unlikely to fit in small cars. For a three-bedroom home, expect to pay a minimum of £400-500.

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