ASK ROSS: Spend, spend, spend! Agreeing to buy a house is just the start of the shopping list. This month, Ross outlines the costs to expect during conveyancing…
Our eminent residential property expert, Ross Ward, answers your questions about moving home. If you have a query about buying or selling, email marketing@tayloremmet.co.uk
I am buying a property for the first time. What fees am I likely to face?
Solicitors’ rates vary, but most have a minimum charge. I would recommend telephoning the firm you wish to use and requesting a written quotation at the outset.
Your mortgage lender will require a valuation of the house you are buying and you may be expected to pay the fee, although some banks and building societies offer a free valuation as part of their package.
In addition, you can commission a more detailed condition report – most commonly called a Homebuyer’s Survey. As with solicitors, surveyors’ fees can differ, but it is prudent to look into any likely problems with the house. You may be able to arrange a Homebuyer’s Survey through your lender, instead of a valuation, to avoid areas of duplication and keep your costs to a minimum.
You could also be charged a one off mortgage arrangement fee and your lender or financial adviser will let you know the amount due. It is usual for the arrangement fee to be added to the mortgage to save you paying it up front, but then, of course, it will be subject to interest.
Your solicitor will want to carry out certain searches as part of the conveyancing, which will vary depending on where the house is situated. For example, in South Yorkshire it is sensible to do a mining search, which costs £50.
Stamp duty is payable to the government on the purchase of any property valued at more than £125,000. At the moment, the tax is set at 2% on the proportion of the purchase price between £125,001 and £250,000, 5% from £250,001 to £925,000, 10% from £925,001 to £1.5 million and 12% thereafter. You can calculate the stamp duty payable on the HMRC’s website: www.gov.uk/hmrc-tools-and-calculators#stamp-duty-land-tax-sdlt
A Land Registry fee is also due on completion and is again payable on the actual purchase price of the property. Your solicitor will have a list of these costs and it will be included in your estimate.
You will need to insure the property from the day contracts are exchanged. Prices are very competitive and your valuer or surveyor will advise you on the recommended amount, so you can shop around. Alternatively, you may want to insure the property through your mortgage lender.
Finally, don’t forget to budget for your moving expenses. The removal company’s cost will depend on whether you want them to do the packing for you, the amount of furniture you have and the distance to be travelled. You will also need to consider any connection charges for services to the property, such as the telephone and redirection of mail.
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