23rd November 2017
A guide to understanding hidden costs
Buying a new home can often be a long and time consuming process with many hidden agreements and outfalls which can be confusing, especially to first time buyers who may be new to the entire process. We’ve broken down some of the biggest hidden costs to look out for when buying a new property.
Stamp Duty is one of the biggest things to look out for when buying a new home. Stamp Duty can vary from 2% to 12% depending on the price of the house you are buying. This percentage can be even higher for those who are purchasing a second property, however, if you’re a first-time buyer, from 22nd November 2017 you won’t have to pay any Stamp Duty on properties up to the value of £300,000.
As of December 2014, Stamp Duty on property purchases is as follows: –
|Property Value||Stamp Duty Rate|
|Up to £125,000||Zero|
|£125,001 – £250,000||2%|
|£250,001 – £925,000||5%|
|£925,001 – £1.5m||10%|
Conveyancing is the legal process of buying a property when the property is transferred from the buyer to the seller. The cost of conveyancing can vary depending on the value of the home you are buying, as well as which searches you are having done. You can expect to pay around £500 and £1,500 for sales conveyancing depending on the complexity of your sale.
As well as the interest charge you will be charged when taking out your mortgage, most companies will also charge a range of fees such as an arrangement fee. Arrangement fees are usually around the £1,000 mark, so bare this in mind before it comes to your sale. You will often find that a mortgage broker charging an arrangement fee will actually be able to find you a better deal on your mortgage, saving you money overall.
Having surveys done on your new property can be essential in future-proofing your home and ensuring that there are no unexpected problems later down the line. However, this can also have more cost implications as you are paying your conveyancer to recruit experienced surveyors to search for any potential problems before you buy.
Unless you have a lot of enthusiastic friends who are happy to help on the big day of your house move, then it may be best to invest in a professional removals company to move all of your belongings to your new property. They also offer a packing service for an additional fee if you do not have time to pack up all of your possessions yourself.
Whether you’re purchasing a ‘project house’ or a pristine new home, there is always some redecorating to be considered in order to make your own mark on your new home. It can be easy to get carried away with excitement when decorating your new home, so ensure to set your budget early and do as much of the decorating yourself to save money.
Fixtures and fittings
If you’re not negotiating for the existing furniture, carpets and curtains, to be included in the price of your new home, this will be something you’ll have to think about before it comes to moving in. You’re going to need the essentials such as a fridge and a bed to make your first night in your new home comfortable. One great way to save money is by purchasing second hand furniture at a reasonable price.
In summary, there are a number of additional costs to consider before buying a property. Here at Matthew’s, our dedicated team of professionals are on hand to advise and can recommend solicitors, mortgage advisors, surveyors and removal companies who we know will provide you with a good service and value for money. Give us a call on 01244 747027 or search for your new property today.