Friday, 11 May 2018

Finance Fridays – Moving costs

We were chasing invoices for last week's Finance Fridays. This week we are looking at the cost of moving house. After sorting out your mortgage or rental agreement you may think that's most of your costs sorted. Before you start planning your house warming party let's have a look at the cost of moving home.

Stamp duty – If you are buying a property then you could be liable for Stamp Duty Land Tax. If all persons involved in the purchase of the property is a first time buyer then Stamp Duty isn't payable on property sales up to £300,000. If you have purchased property before then the price drops to £125,000. The starting rate is 2% for sales between £125,000 and £250,000 and increases as the purchase price goes up. You will need to pay this to HMRC within 30 days of completion of the sale – it isn't something that can be added to your monthly mortgage payments. Stamp Duty can run into thousands of pounds so it is a huge cost of buying a new home.

Legal fees – Paperwork costs a lot of money. When buying a property it is normal for a range of searches to be conducted. Usually your solicitor or licensed conveyancer will do this as part of their conveyancing service. The searches will see if there are any planning issues that may affect your potential new property. This could be potential local building work or if the property is a listed building. Depending on where the property is searches also look for issues with drains, mines or contaminated ground. You can try to do local searches and the other required paperwork yourself but it can get complicated and very time consuming. If you need to find a licensed conveyancer check on the website for the Council for Licensed Conveyancers (CLC).

Estate agent's fee – If you have put your home up for sale then usually you will have gone through an estate agent. Online estate agents often require a fee paid when you put the property up for sale so that cost will have already been dealt with. A traditional estate agent gets paid once the sale has gone through. You might know this in advance if they have a fixed fee but others use a commission basis based on a percentage of the final sale price.

Removal costs – Costs for removal can vary widely depending on a variety of factors. You might have only a few items of furniture to move so hiring a van and roping in a few friends and family may be sufficient. It could be that you are moving across the country which could incur an overnight stop. If you are moving locally quite often it is cheaper to deal with a local removal company as they won't incur any extra travel costs. If you live in London companies such as The Man Van can provide a comprehensive removal service.

Domestic connections/disconnections – Some broadband providers will see a home move as a break in the contract so even if you want to stay with them you will need to pay the termination charge or the rest of the contract. You may find that your current provider doesn't provide a service in your new location so you will need to cancel the service and find a new provider.

Mail redirection – You'll need to inform plenty of people and companies that you have moved address. Some of this can be done by email or completing forms online. Others will only accept paper confirmation with your signature on so stock up on stamps. You'll find there's always someone you forget to inform so it's best to set up mail redirection service. It will also protect you from identity fraud as your post won't be delivered to your old address. Prices start from £33.99 for three months going up to £66.99 for a year's mail redirection.

Have you been surprised about the cost of moving? Did you budget for these expenses?

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Finance Fridays



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