Moving home can be a stressful and difficult period as there are many elements to consider. Packing months ahead of time, conjuring up checklists and gathering packing materials are ways to ensure an easy move, but having a strict and concise budgeting plan is just as vital. Preparing yourself for the numerous costs involved in the moving process will guarantee to keep you on top of your finances. Here’s how.
These fees will be pivotal in determining your budget. In regards to your mortgage, consider booking and arrangement fees. These vary in price depending on what housing plan you are on and your circumstances. Adding these on to your mortgage means paying interest as time goes on, so it’s advisable to pay upfront.
A mortgage valuation is usually included in the mortgage plan, with the cost varying depending on the price of the property you are looking to purchase. Typically, it will set you back between £150 and £1,500. Once the valuation goes through, it’s best to get a private building surveyor to thoroughly inspect the home you are buying, as they will be able to identify any possible repairs or maintenance.
According to a recent RICS report, one in four homebuyers who relied on a mortgage valuation needed to undertake unplanned work in the first year of buying. This amounts to an average cost of over £1,100. There are certain types of surveys that RICS offer, so it’s worth knowing which one is best suited for you.
Paying a deposit is yet another costly action that will add to your budget. On average, you will need to pay between 5% and 20% of the full price. The higher the deposit you put down, the more secure your mortgage will be, and the lower your interest rate.
Stamp duty is a major thing to consider for homes costing £125,001 or more. There is a 3% increase on top of current rates for those purchasing a second home or a buy-to-let property if the cost is above £40,000. Luckily, we have a Stamp Duty calculator so that you’re in the know.
Try to get on top of legal fees (typically between £185-£1,500) and the electronic transfer fee, which will only set you back by £40-£50 but is useful for covering the lender’s cost of transferring the mortgage money to the solicitor.
In addition, make sure you look around for different quotes on a reliable removals firm. Sometimes your existing home insurance policy will cover your move if you’re using a professional moving firm. If you’re moving yourself, however, DIY may still require insurance cover.
On average, removal companies charge £50-£60 per hour for two men and a van, with a two-hour minimum charge for a local move. Long distance moves, however, are charged at a fixed price depending on the location and type of home. This could be anywhere between £450 and £1,000. Note that prices peak on the weekends.
Even after the relocation, you’re not out of the woods yet. Maintenance and repairs will make sure of that. The average repair bill for newcomers is around £5,700, but hiring a surveyor prior would hopefully quell large costs like these.
Insurance costs are crucial for the lender to protect your new home against damage from fire, floods, subsidence etc. Contents insurance is helpful to safeguard your possessions, whilst life insurance would help to pay off your mortgage should you pass before repaying the entire amount.
Make enquiries regarding your council tax, too. This varies from location to location and is calculated on where you live and what council tax band your property falls under. If you’re living alone, you may be entitled to a discount. Don’t worry too much, as you can find that out here.
Be sure to include allowances for the running costs of your home: TV, broadband, phone, gas, electricity, food and water bills will probably take a chunk out of your budget, as well as new furniture and paint jobs.
Lastly, Royal Mail’s Redirection service is a reliable way to continue receiving mail when you move home. This service is available for 1, 3, 6 or 12-month periods and can be redirected to any UK or overseas address.
Frankly, there are many components of the moving process that could be troublesome without a strict budget, so it’s imperative to ensure you have the financial means to cover everything. Keeping these things in mind should help you to better break down all costs and fees, and should effectively limit stress.
We at Hawksbys aim to assist you every step of the way. For more information on selling, letting or buying a home, get in touch with us.