Hidden Costs

Kate87_2

Hiya,

My Boyfriend and I are currently saving to buy a house hopefully early summer next year. We are both saving hard, but i have been trying to look into the hidden costs of buying a house but everywhere i look it tells me differently. We're hoping to get a house for about £70,000-£80,000 as we are lucky that where we are looking that's the average price for the type of house we want. so obviously we have 10% deposit, then the fees for the mortgage (£599-£1000 depending on who you have your mortgage with?) then we have Solicitors fees...but i can't understand how much these are as there seems to be loads of extra which go with this. Surveyers fees, estate agent fee (?) someone else has mentioned HIPs fees? Tax (which i can't understand?) Any help appreciated.
Thanks

pie81

Ok here are the property buying costs that I can think of:

- Purchase price (cash deposit plus mortgage - be aware that many banks now demand more than 10% deposit)

- Stamp duty (tax) - 0% up to 4% depending on the price of the property, I think £80-90k is currently in the 0% band.

- Mortgage arrangement fees (vary from £0 to £1000's - depends on the particular mortgage deal, generally you will pay a higher fee in return for a lower interest rate mortgage)

- Survey fees - your mortgage lender will arrange the survey but you will have to pay for it. The price will depend on whether you just have the basic valuation, the homebuyers' report which tells you a bit more about the condition of the property, or a full structural survey which tells you even more.

- Solicitor fees - anything from £250 to £750, shop around for price and also responsiveness (some of the cheap ones are very slow)

- You don't need to get a HIP if you are the buyer. Also you won't pay estate agent fees.

- Moving costs, redecoration, etc.

really_unimaginative

Given a Purchase Price of around £80k, you can bank on:

Mortgage Arrangement Fee (amount depending on which mortgage you take, probably £1k to £1.5k)
Mortgage Valuation (bare minimum will be £300 to £500 depending on the mortgage provider)
Broker's Fee (hopefully nothing if you've used a fees-free broker)
Conveyancing (Including the searches that your solicitor will do for you, I paid just over £500 in 2004 for a £90k property so anything from £400 to £1k)
Land Registry Fee (£50 or more, check landregistry.co.uk/online/feecalc )
Moving In (By yourself £200+ for van rental, boxes, fuel, etc., with professionals £400+ but depends on the amount of stuff you have)
House Insurance (minimum buildings, amount depends on area and house but we pay £37 per month) from date of exchange

Miscellany depending on what you already have:

Connection Fees for Phone, Broadband, Sky, etc. (depends on the providers)
TV License (if you don't already have one that is to be transferred)
White Goods (Cooker, Washing Machine, Fridge, Freezer, etc.)
Curtains & Carpets (try to get them included in the sale for nothing as they'll be wrong for the seller's next house)
Initial Furniture

Kate87_2

really_unimaginative wrote: »

Given a Purchase Price of around £80k, you can bank on:

Mortgage Arrangement Fee (amount depending on which mortgage you take, probably £1k to £1.5k)
Mortgage Valuation (bare minimum will be £300 to £500 depending on the mortgage provider)
Broker's Fee (hopefully nothing if you've used a fees-free broker)
Conveyancing (Including the searches that your solicitor will do for you, I paid just over £500 in 2004 for a £90k property so anything from £400 to £1k)
Land Registry Fee (£50 or more, check landregistry.co.uk/online/feecalc )
Moving In (By yourself £200+ for van rental, boxes, fuel, etc., with professionals £400+ but depends on the amount of stuff you have)
House Insurance (minimum buildings, amount depends on area and house but we pay £37 per month) from date of exchange

Miscellany depending on what you already have:

Connection Fees for Phone, Broadband, Sky, etc. (depends on the providers)
TV License (if you don't already have one that is to be transferred)
White Goods (Cooker, Washing Machine, Fridge, Freezer, etc.)
Curtains & Carpets (try to get them included in the sale for nothing as they'll be wrong for the seller's next house)
Initial Furniture

Thanks guys, that is really helpful - i've been checking a few banks mortgages and there is still quite a few who will let you have a mortgage with just 10% but some of the fees are higher - there is one with HSBB which is £599 and one with natwest which is £799. So hopefully these offers will still be around in a few months time.

We've got all the furniture we need - various relatives have donated/taking things from home, so we're sorted there. Just a few white goods which we will need to get.

Now we just need the rest of the money and a house

G_M

Take a look here or google 'buyers moving costs'.

LizzieS_2

Kate87 wrote: »

Hiya,

My Boyfriend and I are currently saving to buy a house hopefully early summer next year. We are both saving hard, but i have been trying to look into the hidden costs of buying a house but everywhere i look it tells me differently.

Guessing this is your first purchase?

We're hoping to get a house for about £70,000-£80,000 as we are lucky that where we are looking that's the average price for the type of house we want.

The boring but important bits - look at the mortgage, ask around for electricity, gas,water, council tax bills. Those are your most important bills, work out how much you have left. What kind of increases in those bills can you afford (not asking directly, just making you think ahead)? How much will you have left? (again not a direct question - aiming at letting you think the costs you will incur for food, clothes, TV, telephone, future savings..... and......... arghhh the expense of a child - yes we all say no way but change later).

so obviously we have 10% deposit,

good, the more you save the better in the longterm (agree it doesn't seem like that now).

then the fees for the mortgage (£599-£1000 depending on who you have your mortgage with?)

Some add this to the loan, so in effect you negate some of the savings. Not a big fan of the deals - the banks won in every one I had previously. Look at some of the trackers and most importantly the history of mortgage rates against BOE base rates for each company.

then we have Solicitors fees...but i can't understand how much these are as there seems to be loads of extra which go with this.

There are some fixed costs which your solictor will either add or ask you to pay separately (things like deed plans, searches etc). Overall the total for a FTB should be around £500-£600.

Surveyers fees, estate agent fee (?)

Your mortgage provider will expect to to use certain ones (depending how you mortgage). A basic fee can be under £200, but these are only looking for the the price being at leat right (they don't tell you if it is worth more) and major obvious structural faults). You can pay a lot more for a more detailed survey - on an older property that can sometimes be worth it.

someone else has mentioned HIPs fees?

Doesn't apply to buyers

Tax (which i can't understand?) Any help appreciated.
Thanks
Stamp duty is paid to HMRC, but it would not apply for the purchase prices you are looking at.

It is one big minefield in which is the best mortgage - most people make decisions for the wrong reasons.

As for the house contents - you need to ask yourself what is really essential.

On another note, the local police can give you an insight into what certain areas are like (not having a go there due to purchase price being low - I've seen some at less than half that), as can reading local newspapers. Never rush into a buying - always look at what will be better for you in the long-term.

Kate87_2

Again, thanks for all of the information, it's been really helpful.

RAS

Kate87 wrote: »

We've got all the furniture we need - various relatives have donated/taking things from home, so we're sorted there. Just a few white goods which we will need to get.

Now we just need the rest of the money and a house

Check out www.freecycle.org where you can get stuff for free. May not be what you need long-term but would tide you over until you can buy new stuff.

Kate87_2

Thanks - i'll check that out.

I'm struggling a bit with the land registry thing. I might be being really dumb, but which option is the correct option? there are hundreds!!

Richard_Webster

I'm struggling a bit with the land registry thing. I might be being really dumb, but which option is the correct option? there are hundreds!!

Don't really know what you mean by "option".

When you buy in England/Wales you have to pay a Land Registry fee based upon the price band the property is in - for £50K+ to £80K it is £80 and for £80K+ to £100K it is £130.

There will also be a Land Registry Search which costs £4. Most properties only have one title.

There will be Land Charges searches to check you are not bankrupt - generally if done on line £2 per name of mortgage borrower.

Is there anything else you need to know about Land Registry Fees?

lv565

Hi, my partner and I have just exchanged contracts on our first house. We move in on Friday!
It cost us £80000. The land registry fee was £80 - but this was included in our fixed quote from our solicitor. The solicitor cost us £496 in total.

I think everyone has covered most of the other costs - I have come across a couple in the last day or so - the bank will charge you a CHAPS fee of about £30 to transfer the money to your solicitor.
Also I have just paid the Halifax £25 to get our deposit to the solicitor via a CHAPS payment.
It also cost me £5 to send the contracts etc...back to the solicitor by next day delivery!
There are lots of little bits that all add up!
Good Luck!