It is generally accepted that buying a property is expensive, especially when stamp duty comes into play. However, very few people are aware of the costs involved when selling too. From EPCs to estate agent commission – there are several costs we completely forget about when selling up. For those of us who want to make the most of our money is there any way to make selling your home not break the bank?
How much does it cost to sell a house?
There are a handful of expenses you naturally cannot avoid when selling your home. Often the largest or most common form of expenditure is the estate agency fees. How legal fees, and the cost of an energy performance certificate, removals and stamp duty (currently on a property above £500,000) all adds up and simply be avoided.
In order to help you save money during these testing times, this piece will break down some of the major financial areas of buying a house.
Estate Agency
The commission varies between different high street estate agents. If you are selling your home, you could pay anything from 0.75% and 3.0%+VAT on the price your house sells for. However, fees can vary depending on the type of contract you have with an agency too. On lower value properties, they may charge a fixed fee, whereas there can room for negotiation if you have a high-value home or are happy to agree to a sole agency contract.
Solicitors Fees
When it comes to the legalities of selling your home, you will need to hire a solicitor or conveyancer. This individual will handle the entire legal and financial process and typically charge a one-off fee or a percentage cut of the value of your home. You could find yourself charged more if you are selling a leasehold property. Other prices under this umbrella may include:
- Copy of title deeds
- Money-laundering checks
- Bank transfer fee
EPC Costs
It is the law to provide any prospective buyers with an Energy Performance Certificate (EPC). Once a report has been commissioned, the EPC results should be contained in all marketing material for the property. The cost of an EPC will depend on the type of property you have and the number of bedrooms.
Removals
Organising a removal company is often one of the more stressful jobs you can do. Ensuring you have the right home removals company for you is essential for your move and if done without the correct preparation can cost hundreds or even thousands of pounds. It is important to note a number of factors will determine the cost of using a removals company, for example, the amount of goods being transported the distanced travelled and the size of the crew needed, to only name some.
A good removal firm will offer you a pre-move survey as well as a full explanation of charges, as well as how you might be able to lower the cost of the move. Furthermore, many firms promote the recycling of packing materials, so if you source your own packing materials and for example, pack your own goods, they will more than likely honour a discount.
Stamp Duty
Stamp Duty Land Tax is a tax that is paid by people buying property across England and Northern Ireland. The single lump-tax applies to anyone purchasing a property or piece of land costing more than £125,000 at purchase. The amount of tax paid on the completion of the purchase is tiered – as the property price increases the rate of tax increases.
However…
Homeowners in England have been provided with a reprieve when the Chancellor’s recent stamp duty announcement placed a temporary halting on the minimum threshold of property from £125,000 to £500,000 until March 2021. The temporary changes to the minimum threshold will mean that any buyer completing the purchase of a property under £500,000 will not have to pay stamp duty on the transaction and open up the possibility of saving up to £15,000.
The move to temporarily increase the minimum threshold at which stamp duty kicks in has been welcomed with open arms by buyers and estate agents throughout the UK, with some 9/10 buyers benefiting from this.
The Stamp Duty holiday also applies to buy-to-let and second home purchases, but landlords and investors will still have pay the 3% surcharge at all levels of investment, including those below £500,000. Although the tax is yet required, the announcement by the Chancellor has made it dramatically cheaper for investors to increase their property portfolio and increase the available potential return on investment
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