Extra costs of buying a house

Shortypie89

Hi all,

So I know there are lots of costs of buying a house in addition to the deposit and stamp duty e.g. survey, solicitor fees, mortgage arrangement & valuation fees, searches, moving van, furniture etc.

I've found plenty of sites which list all these out, but they can vary a lot e.g. a mortgage arrangement fee might be anywhere between £200 and £2000. So I'm just wondering what people here budgeted for these fees, and their capital saving, when putting money aside to buy?

Essentially, I have my savings of X, and so will work out what I can afford as a deposit by deducting a) stamp duty b) all the extra fees, and c) how much capital I want to have saved once I have bought a house. And I'm curious what people put aside for b and c

Many thanks!

GoldenShadow

We knew we were aiming for 10% deposit but naturally there was some flux depending on the property price as to what that was.

I basically did a worst case scenario, e.g. if the ideal house is at the top end of our budget. So I worked out the stamp duty, deposit etc and took a pessimistic view for estimating surveys. At any point when we were looking, I knew what property we could be offering on based on how much I'd allocated where, but we had a 5K slush fund for things we had miscalculated (and furniture, white goods etc as FTBs) just in case.

Some things, like for a homebuyer's report, on here people said budget £500. We had two (different properties), one was just under £300, the other just over. But I estimated it to be £500 even after I got quotes for less.

kim_smith

Did you try with FHA loan option? This may help you. Or you can also check with home buying authority options.

barginboyrob

I set aside around £3,000 (ex stamp duty) to cover broker fees and all the solicitor fees. I add my mortgage fee (except the valuation fee) to the mortgage

Haylescom

We've set aside 8k for all fees and stamp duty. We are selling a property as well as buying so it's increased for us.

societys_child

kim_smith wrote: »

Did you try with FHA loan option? This may help you. Or you can also check with home buying authority options.

Not sure we have the "Federal Housing Administration" loan option in the UK.

kinger101

I'm not sure what you are planning in terms of a deposit, but bearing in mind it's not difficult to get 3% interest (e.g., Santander - the cashback should cover most of the fee), and this will be tax free from April 2016, it can work out better to go for an 85% mortgage instead of 80%, and then have a little extra rainy day money set aside. Provided you have the financial discipline not to spend it on shiny things just because it's there.

Some people don't have a cash buffer (not wise IMO), but the amount you'll need will be different depending on the age of the property. The fees also vary with freehold/leasehold, and what type of survey you'll need, and your approach to risk (check everything or accept old property might need new roof in next five years).

uk_american

Just completed two weeks ago, 230k house. 130k deposit. 100k mortgage. I am in a commuter town to London, in Essex.

Payment to bank: 1800 mortgage arrangement fee + 200 mortgage survey + 120 cash transfer/completion fees.

Payment to solicitors/conveyancing: 3225. 2100 of that was stamp duty. The rest was their fees, searches, etc. I used a local one rather than a less expensive postal version so may have paid more, but worth it for me, less stress, having previously used a postal one.

Payment to my surveyor: 300.

No move costs as bought as a buy to let. I had no decorating costs as it was in pristine condition, but I'd allocate X additional to your budget for carpets, paint, tiles, etc. as these things are easiest to do before you move in your furniture and get settled.

I'd also add in an additional buffer % for 'things you don't know.' My solicitor brought up the option of various additional searches and depending on the results of your survey, you might choose to have more in depth reviews done.

Then factor in your homeowners' insurance cost that you'll need to pay from day 1.

Shortypie89

Thanks everyone, really helpful! I'd put aside £6000 for everything (not inc. stamp duty/deposit. Including survey, solicitor, mortgage, furniture, van - I am a first time buyer previously renting so would need ALL furniture inc. white goods) but it sounds like I might get away with slightly less. I'd also thought I'd save £4000 in cash for peace of mind. So I'm reassured now that I should be absolutely fine with £10,000, and might even consider adding a couple of grand into the deposit. Although, if it's a choice between adding 2 grand into the house or keeping it, I imagine the interest rates won't vary wildly so maybe worth holding in reserve?