How to budget for buying your first home.

When it comes to taking your first step onto the property ladder, there are several costs to budget for. These are costs which you might not have necessarily considered after saving up for the deposit.

You can prepare yourself by considering, and budgeting for, the following extra costs – this will help you to avoid any nasty surprises later down the line:

Conveyancing fees

• You will need to instruct a property solicitor or licensed conveyancer to deal with the legal side of buying the property. This process is commonly known as conveyancing.
• The cost of the legal fees can be affected by a number of different factors, including the type of property, the value of the property and the complexity of the transaction.

Searches

• Your solicitor will conduct various searches on the property. This is to investigate if there are any issues with the property which you need to be aware of, such as flooding and planning proposals.
• Searches are required by mortgage lenders to ascertain whether there is anything which could affect the property value before offering you a mortgage. If you are buying without the need for a mortgage, you can choose whether or not to have these searches – although we would always strongly recommend that you do.

Stamp Duty Land Tax

• In England first time buyers purchasing their first home for £300,000.00 or less do not have to pay any Stamp Duty Land Tax.
• However, on properties priced between £300,000.01 and £500,000, there is no stamp duty payable by a first time buyer on the first £300,000.00 and then 5% is payable on the amount over £300,000.00.
• First time buyers are required to pay stamp duty at standard rates on properties which cost over £500,000.00.
• Please be aware that Scotland and Wales have different rules on stamp duty.

House survey costs

• It is recommended that to protect yourself from buying a property with defects, a survey should be carried out on the property by an independent surveyor.
• There are different types of survey. The type of survey which you will require depends on the age and condition of the property, your budget and the detail you require from the survey.
• If you are purchasing the property with a mortgage, the valuation arranged by the lender does not investigate any structural issues on the property. This only considers how much the property is worth.
• The cost of a survey can range from £500 upwards. However, this is considered to be worth the investment if any defects are revealed on the property (and it can be a good bargaining tool too!).

Land Registry fees

• The Land Registry deal with the registration of properties and land in England and Wales. It also keeps records of all registered properties.
• It is compulsory to register the property with the new owners and the Land Registry charge a fee this. The fee varies depending on the property price.

Removals costs

• Costs for removal companies will vary depending on the amount of furniture and belongings you have, the distance travelled from the old to the new property and whether you choose to have your belonging professionally packed.

If you would like to speak to someone about your property, or have property to buy or sell, Poole Alcock would be delighted to help you.  Visit our website for a quote, or call us on 0800 470 0336.