Buying a Property - The Costs

Know the potential costs before before starting the process

 

Buying a Property -

The Costs

 
 
 
 
 
 
 
 
 
 
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Wondering how much it costs to buy a house or a flat? There are a number of fees to consider when buying a new property, including the cost of moving home, your deposit and solicitor fees. This guide will help you plan for all of these when you work out your budget.

Major upfront costs

Make sure you have saved enough to cover all of the upfront costs.

These include:

Stamp Duty

The cost of Stamp Duty Land Tax (SDLT), is an important consideration when purchasing a property and something that must not be overlooked. The simplest way to find out what you may need to pay is to use a Stamp Duty Calculator. Enter "Stamp Duty Calculator" into favourite search engine and you will discover multiple options.

Deposit

This is the amount you put towards the cost of the property when you buy your property.

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). A larger deposit will generally offer you lower payment rates

Valuation fee

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 might not charge you for this, depending on the type of mortgage product you select.

The lender’s valuation is not a full structural survey so it might not identify all the repairs or maintenance that might be needed.

Surveyor’s fee

Before you buy a property you may wish to have it checked by a surveyor. This is vital so you understand if there are any problems 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 in the long run.

Legal fees

You’ll normally need a solicitor or licensed conveyor to carry out all the legal work when buying and selling your home. Legal fees are typically £1200-£2000 including VAT at 20%.

They will also do local searches, which will cost you £250-£300, to check whether there are any local plans or problems.

Electronic transfer fee

Typically this costs £20-£50.

It covers the lenders cost of transferring the mortgage money to your solicitor/conveyancer.

Removal costs

These are usually around £600, although you could rent a van and do it yourself!

Mortgage fees

These might include:

  • An application fee of typically £99-£300

  • An arrangement fee of £0 up to £2,000

  • A mortgage valuation fee of £0 up to £500 or more.

It’s best to pay these fees upfront rather than adding them to your mortgage, otherwise you’ll be paying interest on them for the life of the mortgage.

Insurance

The lender will require you have buildings insurance to protect your new property against damage from fire, floods, subsidence and anything else.

It’s also a good idea to have contents insurance for all your possessions, and life insurance to pay off your mortgage should you die before you’ve repaid the entire amount.

As part of our service, your Mortgage Guru will provide you with quotations from our independent panel of leading insurers.

Council Tax

The amount you pay is based on where the property is based and its valuation band (apart from in Northern Ireland where rates are set individually).

Leaseholders’ costs

If you buy a leasehold property, you’ll have to pay ground rent (around £50-£100 a year) and service charges to the person who owns the freehold.

Service charges and admin fees differ between properties.

This is an important cost of running a property so it’s vital you know more about these charges.

Mortgage Broker Fee

The Mortgage Gurus charge a flat fee of £295, which is only payable once we have received a mortgage offer on your behalf from a lender.

Buying a property -
The costs
Major upfront costs
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Stamp duty
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Deposit
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Valuation fee
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Surveyor's fee
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Legal fees
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Electronic transfer
___________________________
Removal costs
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Mortgage fees
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Insurance
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Council tax
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Leaseholder's costs
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Mortgage broker fees
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Remortgaging -
The steps
How do I remortgage my home?
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Working out how much you can
afford to pay
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Investigating the costs
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Looking around for a new mortgage
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Checking what your current lender
can offer
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Getting your mortgage offer
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Mortgages -
A Beginners Guide
What is a mortgage
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Working out what you can afford
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Applying for a mortgage
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Your deposit - Size matters
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How does a mortgage work
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Repayment mortgage
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Interest only mortgage
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Different types of mortgage
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