When it comes to selling your house and buying another, homeowners will take into consideration the costs involved in buying a house, but forget about the costs incurred when you sell. The housing market has opened back up, but with house prices dropping, homeowners are doing everything they can to keep costs low and get the best price possible. That’s why we’ve looked into those costs, to give you all the information you need when you sell your house.
Are there extra costs to selling a house?
There are several costs involved when you sell a house that homeowners don’t always think of. You will need to consider the price of an EPC, your estate agent fees if you choose to sell your house on the open market, along with conveyancing and legal fees. This doesn’t include the potential costs of an early mortgage repayment charge if your contract has this clause, any work you might need to do on the house before selling, and any capital gains tax you might be liable for. With all of this combined, the average homeowner will need to pay close to £5,000 when selling their house.
Why do I need to know about these costs?
Selling a property is a stressful time especially when you are selling a property with tenants, so making sure you have all the information you need before you start the process will help you stay in control. It will also make sure that you don’t find yourself in an awkward position financially, as you know going into it what the costs are. Selling and buying is a huge financial commitment, so going in fully prepared will help you have the smoothest experience possible.
Hidden costs broken down
Knowing the details of these costs can help you make the best decisions in your situation. Some of these costs can be avoided, but some have very little flexibility, so homeowners should factor them into their moving process to avoid any nasty surprises mid-sale.
EPC (Energy Performance Certificate)
The cost of an EPC can vary, depending on your property. You will need an EPC when selling your house, as it outlines the general energy costs in your home along with how this could be improved. An EPC is valid for ten years, so if you bought your house in the last ten years, you might find that your EPC is still valid, saving you the cost of a new one. The general cost of this certificate is relatively low, usually between £60-£120.
Estate agent fees
Estate agent fees are often one of the higher fees involved when selling your house that homeowners don’t think about. A lot of homeowners believe the only way that they can sell their house is to go down the traditional route and forget that there are other alternatives, such as hiring a realtor that charges a flat fee rather than one who works off commission. Estate agent fees tend to be between 1-3% of the sale, but there are other sale options. Companies like We Buy Any House will buy your house from you with no hidden costs, no estate agent fees and no legal fees, keeping costs down for you.
Conveyancing is a legal process that you need to go through when buying or selling a house, so if you’re looking to sell one house and buy another, you could end up having to pay fees on both sides. Some conveyancers will offer you a deal for doing both with them to lower the costs, but you will need to talk to your conveyancer to see what they can do for you. Conveyancing can be charged in two ways – in a fixed cost, or on a percentage basis depending on the value of your house. You will need to see which works best for you, but conveyancing tends to cost between £500-£1000- it could possibly be higher too. The cost will differ for various reasons, including if you still have a mortgage or not, and if the property is freehold or leasehold.
Your moving costs will vary greatly depending on how much you have to move and how much help you need to do it. If you only need to hire a van and can do the majority of the lifting and moving yourself with the help of friends and family, you will be able to keep your costs much lower. If, however, you need to hire moving men along with a van, your costs will be significantly higher. You can get quotes from different places and find the best offer you can, which should help you reduce costs.
Before putting your house up for sale, it’s often recommended to do some work to increase the chances of selling. If you are considering doing this, you will need to think carefully about what improvements you want to make and how much it will cost to do these. Some improvements will raise your value, but make sure that you’re not spending more than you will increase the value by and leave yourself at a loss.
The most recommended improvement is to redecorate the house – while this won’t increase your value particularly, it will encourage more potential buyers to view your house, and will make it more likely for those viewers to put in an offer. There are plenty of other home improvements that you can think about if you are happy to put some money behind it, but a lot of homeowners don’t want to do this to a house they’re about to leave. That’s why redecorating is a popular choice – it doesn’t have to be particularly expensive, but should help you hit your sale faster.
When you’re selling your house, you want to make sure that you take into account the various hidden costs, so you don’t get caught out once you’re in the process. Planning in advance can help you keep those costs down, and let you use that money to spend in your new home.