So, you’re a first-time buyer. You’ve managed to scrimp and save over the last few years and are finally in a position where you can afford to put a deposit down on a house. The deposit is only the first part however and in this article we are going to take a look at the other costs that you need to be thinking about when buying your first home.
Although the Government put stamp duty relief into place in November 2017, if the property you’re buying is over £300,000, you are eligible to pay stamp duty, even as a first-time buyer. Now some people may be reading this thinking: who as a first time buyer is going to be spending that much on a property? But if you are in the South East, which has an average property price of £373,000, or in London, where even flats average at £420,000, you may not have any choice.
Stamp Duty is a percentage that changes depending on the value of the property but as an example, if you were to buy a property as a first time buyer for £350,000, you will not be required to pay stamp duty on the first £300,000 however the remaining £50,000 would require Stamp duty paying at a rate of 5% which in this case amounts to £2500.
There are several different types of surveys and it’s important to understand the difference between them. The first and most common is a mortgage valuation survey. This is required by the lender so that they can be satisfied that the property is worth the amount they are lending. It’s essentially a valuation and nothing more; it won’t point out specific structural or repair problems. The cost will vary depending on the size and value of the property; they start at around the £150 mark for a smaller property such as a flat and go up to £1500 for larger properties.
The next type of survey is often known as RICS (Royal Institute of Chartered Surveyors) survey and can actually mean one of several different things. These aren’t always mandatory depending on the property but can save you money in the long run by identifying problems up front.
The first and most basic of these is a RICS Condition Report. This is generally most suitable for new builds and standard homes as it will only describe the condition of the property, highlight any potential risks and flag any potential legal issues. The type of report will cost around £250.
A RICs HomeBuyer Report is the next step up. It’s more in depth than a condition report but still will not look behind walls or under floor boards. Costs for this type of report are around £400.
A RICs Building Survey is the next level up still. The level of information that it supplies is equivalent to a full building or structural survey but presented in a clear and easily understandable manner, as well as providing advice and guidance on how to tackle any issues that may be present. You should expect this type of report to cost around £400 to £500.
The important thing to understand, with all forms of survey, is that while they may be able to point out some issues that are present in a property, they will not be able to find every fault. The survey may note for example that a central heating system is present. What you will not be able to tell is if that central heating system is in good working order. The same goes for the electrical circuits present in the property. A survey may recommend that a full Electrical Inspection Condition Report is carried out. You could have this report carried out and find out that the property requires a full re-wire, the cost of which varies, but for a three bed semi-detached house this is in the region of £3,200, which is why it’s important to consider having the report done before going any further.
When considering a survey take into account the age and general state of the property and any relevant information you or the seller has. If it is a reasonably new property, or the seller has proof of major works, such as re-wire or a new central heating system and the property in general looks well looked after, you may feel relatively confident in going for a more basic survey. If however it’s an older property and there’s no evidence of work having been carried out recently if at all, and is in a poor state or repair, it is worth spending some money up front to identify any possible problems. It’s also worth having some money set aside for any surprises that may crop up, such as the need for a re-wire or a new boiler.
Using a professional removal company has its pros and cons, but can work out very expensive depending how far you are moving and how much you are moving. Moving from a 2 bedroom flat to a 2 bedroom house costs on average £600, budget another £150 to £250 if you opt for a packing service as well. If you do decide to use a removal company, it is best to make sure that they have insurance to cover the cost of damage to any of your possessions.
The alternative to this is to do it yourself. If you don’t have masses of furniture and household possessions a good route is to look at hiring a van and doing all the work yourself. An extra large commercial van can be hired from as little as £41 per day. It may be harder work doing it this way, but you will be saving a lot of money by doing so.
You may be in a position where you need to store some of your possessions before completing your move. Fortunately this is relatively cheap, with small storage units capable of taking a sofa or bed starting from around £4 per week. But again you will need to factor in the cost of transporting your goods there and back.
There are a few smaller things that many people forget to think about when moving house that can quickly add up. Will you be able to cook straight away upon moving in or do you need to take into consideration the cost of a couple of days of takeaways? If you have pets, will it be easier to arrange to put them in kennels or a cattery than try and keep an eye on them all day? The same goes for children; you may have been fortunate enough to arrange the move when they are at school, but if they are too young or the move takes place in the holidays will it be easier to pay for a child minder for the day?
Contact the sales team for more information
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