Everyone knows roughly how much it costs to buy a home, but selling a home? That’s affordable, right? After all, you’re not the one paying for a new pad. But there are a number of hidden costs involved when selling your home that can easily be overlooked or underestimed.
Before you start budgeting to buying and moving home, let’s break down the costs you can expect to encounter first when selling.
Estate agent fees
Estate agents work on a commission basis, so you can expect the firm you choose o charge a fee that works out as a percentage of the sale price – typically, around 2 to 3 per cent. In other words, the more your house is worth, the ore you can expect to pay.
Private advertising fees
Want to avoid paying high estate agent fess? Selling your home privately is a popular option, with FSBO services such as Sell My Property able to save a lot of money through either fixed fee or subscription charges in advance. Whether they are expensive or not, the most valuable thing is not having a surprise fee to deal with later.
The other option for selling your home is going to auction. This is similar to an estate agent, financially speaking, in that a commission will be owed to the auction house helping to put your home under the hammer. However, you may have to pay additional fees for services such as promotional activity and cataloguing.
One unavoidable cost however you sell your home is the fee charged by your solicitor or conveyancer: costs can vary depending on the level of legal work required and the prestige of the legal company used, but will start from around£200.
Insurance for a property sale may sound odd – this is far from the contents or building insurance you will be used to – but an indemnity policy will cover any defects in the title of a property, such as a missing document. If that is a problem, the insurance would pay the buyer compensation and save you from being saddled with further costs. Insurance is, however, an optional expense.
You may well be sick and tired of paying your mortgage, but for those planning to pay off the loan early, be warned: repaying can cost up to 4 per cent of the outstanding volume. Exit fees for those planning to switch lenders can also apply.
An Energy Performance Certificate is now a legal requirement for a UK home when it is being sold. Estate agents will usually arrange this for you, but if you are selling privately, you will need to organise this. Ordering a certificate costs approximately £60. Use an authorised service only.
Add the above to your budget sheet for moving home, along with removal vans and cleaning companies, and you have a good idea of how much it can cost to sell your property.
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