Buyers - Costs involved in Buying a Property
Thinking of moving and buying a home? Let us help you estimate your overall costs.
When you buy a property or move home, there will be a number of upfront fees beyond just your mortgage costs, which you'll need to take into account. Be sure to include these when working out your overall budget.
Make sure you have saved enough to cover all of the upfront costs.
This is the amount you put towards the cost of the property when you buy your home. On average, you need at least 5% to 20% of the purchase price (for example: £10,000 to £40,000 when buying a £200,000 home). Generally, the bigger the deposit, the more likely you are to be given a mortgage, and the lower your interest rate is likely to be
- Up to £125,000 : 0%
- £125,001 to £250,000 : 2%
- £250,001 to £925,000 : 5%
- £925,001 to £1.5m : 10%
- Above £1.5m : 12%
For example, if your new home costs £175,000 you'll pay £3,500 (2% of the property value that falls within the relevant band). Use a Stamp Duty calculator online to find out how much you'll be exactly paying back.
* An additional property purchased for less than £40k will attract 0% tax. For purchases from £40k to £125k the rate will be 3% on full purchase price.
Stamp Duty Land Tax applies to properties that cost over £125,000, except in Scotland where since 1 April 2015 Stamp Duty doesn’t apply. Instead you’ll now pay Land and Buildings Transaction Tax when you buy a property. This tax applies to both freehold and leasehold properties – whether you’re buying outright or with a mortgage.
The mortgage lender will assess the value of the property to establish how much they are prepared to lend you. The cost can be £150-£1,500 based on the property's value. Some lenders may not charge you for this, depending on the type of mortgage product you select. The lender's valuation is not an extensive survey and will not necessarily identify all the repairs or maintenance that might be needed.
Before you buy a house you should have it checked out by a surveyor. This is vital so that you understand if there are any issues with the property before you buy. Surveys range from a basic home condition survey costing around £250 to a full structural survey from £600 or more. Paying for a good survey could save you money on repairs further down the line.
You will need a solicitor or licensed conveyancer to carry out all the legal work when buying and selling your home. They will also do local searches, which will cost you £250-£300, to check whether there are any local plans or issues. On top of this the legal fees are typically £500-£1,500 including VAT at 20%.
This is only paid by sellers, not buyers, for the estate agent's services.
Typically £300-£600 though you could do it yourself. Removal firms charge more at weekends and at the end of the month.
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