Besides the actual price tag on the property, what are all the other costs involved in buying a house?
The list I have so far includes:
Stamp Duty
Property survey
Mortgage arrangement fee
Solicitor fees (what exactly is it they do for you??!)
What else is there and what do the above items cost?
Any help much appreciated.
PS this is a United Kingdom question.
Answer by capitalgentleman
I'm not sure about the UK, but in Canada you would have:
- Land Transfer Tax (a percentage of the total price - about 1% or so)
- Home inspection - a few hundred dollars (say, £200 or so)
- Legal fees - this is to prove that the title to the house is clear (there are no liens on it). Most of this is required by the banks before they lend you the money. It varies, but could be about £2000.
- Dispersement - as well as the legal fees, there will be charges for the paperwork - getting titles search, registering the deed itself, and so on. This could vary. Estimate £500 (bit of a guess this!)
- Taxes - there are usually taxes on property. Depending on your move-in date, you will owe the sellers the taxes they have already paid. E.g., they have paid taxes for the year, and you move in in June. You own them June-December's taxes. This will vary greatly as well. At my old house, taxes were over $ 5000 per year; where I am now, it is about $ 800.
- Survey - varies a lot by area. Estimate £150
- Mortgage - some banks may charge fees to get a mortgage, but these are small. Discharging a mortgage at the end is where they get you! Estimate here about £100
- Utilities - when you get new accounts for power, water, sewage, telephone, gas, cable TV, etc., each usually charges fees for new or transferred accounts. These often run about £10-20 each here. Say £100 for the lot.
- moving fees - the company that moves you from where you are to the new place. This can vary a great deal, depending on the amount you have, and the distance. My move this summer cost nearly $ 20,000 (about £7-8000), but that was for a long move (over 6000km - Canada is a big country!).
I think that about covers it. You may also want to do some redecorating, which could cost the moon - I've spent nearly $ 40,000 putting new windows and doors in my place, so far, and there is a lot left to do to make this place truly livable. You may also want professional cleaning down before you move in, although the moving process itself will make a bit of a mess.
As you can see, buying a house is expensive, and not just the cost of the house! This comes as quite a shock to some people. However, it is all worth it - the feeling of owning your own place is wonderful, and you are also building equity, instead of paying rent. Good luck!
Answer by La Comtesse De Whippet
You pretty much have it all - some solicitors charge extra for searches, and you may well have to pay the mortgage company for the property valuation. Other than that you just have removal costs and any ground rent or leasehold charges which need addressing immediately.
Information here about what a solicitor does during a purchase: http://www.britsandmortar.com/Conveyancing-process
Stamp Duty Land Tax (SDLT) depends on the sale price of the property: until the 31st December 2009 there is no stamp duty on properties under £175,000 (previously and afterwards £125,000). It's then 1% on properties £125,001 - £250,000, 3% on properties £250,001 - £500,000 and 4% on anything above that.
Everything else varies - conveyancing is expensive, typically on a £200,000 house you can expect to pay your solicitor between £500 and £1,000. A good basic survey can be £200 - £300, a more in depth one closer to £1,000. Some lenders charge as much as £500 for mortgage arrangment and valuations, others only a hundred or so.
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