Selling a house can be an expensive business. From estate agent fees to early repayment penalties from your mortgage lender, the costs soon add up. What’s more, almost half of all house sales in the UK fall through before completion costing sellers an average of £2,727 in unrecoverable legal and marketing costs. Unfortunately, selling on the open market leaves homeowners vulnerable to a failed sale as the buyer is legally entitled to change their minds until exchange occurs. Unless the seller chooses to take the house off the market, they will have to bear the costs of selling again when they find a new buyer.
In this blog, our team of property experts have broken down the main costs of selling a house to help you budget and make savings where possible.
The Cost of Selling a House
Estate Agency Fees. An estate agent will typically charge a homeowner a fee of 0.5%-3% (+ VAT) of the sale price to manage the sale of their home. On a home costing £234,742 — the average house price in the UK according to the UK House Price Index — that’s a whopping £7,042.26 at a fee rate of 3%. Even at the average rate of 1.25%, the seller would be charged £2934.28; a considerable sum.
Conveyancing Fees. Every homeowner must instruct a solicitor or licenced conveyancer to manage the sale of their property. The average conveyancing fee for selling a £234,742 property is £1,170. The amount will increase with the value of a property. In addition to this fee, there will be several administrative costs to cover, including a fee to send the title deeds to the buyer (around £6), the cost of money-laundering checks (£8 per person) and a fee for transferring the final sale funds (around £40). If you’re using certain types of “help-to-buy” funding, such as a Help-to-Buy ISA, there will be an additional charge for processing the transfer of these funds.
Remortgaging Fees. If you choose to end your current mortgage and move to a new provider, there may be exit fees to pay. These vary but are typically between £50 and £300. Early repayment charges may also apply and these range from 1-5% of the loan amount.
The Cost of an Energy Performance Certificate (EPC). Anybody selling a property must provide the buyer with an Energy Performance Certificate (EPC) that details the energy performance of the property and what can improve it. An EPC will cost between £50 and £120 and is valid for 10 years.
Removal Costs. These can vary wildly depending on the number of possessions you need to transport, how far away you’re moving and the level of service you require. Some companies will charge a fixed fee for the entire job; others will set an hourly rate. There may be additional costs if the job takes longer than expected or if transporting your possessions requires extra effort such as dismantling furniture or protecting valuable items. Insuring your possessions will be a further cost to budget for if this is not included in the removal quote.
In addition to these outgoings, don’t forget to factor in the ongoing costs of mortgage repayments while you wait to find a buyer, days off work to manage the move and the potential cost of making home improvements to increase the chances of the property selling.
Ways to Cut the Cost of Selling
Swap Estate Agents or Go Solo. Agent fees vary considerably. Shop around to find the best deal or negotiate with your current agent. If your home is high-value or you are willing to agree to a sole agency contract, the agent may well accept a lower percentage of the sale price. You can also save a considerable amount by switching to an online estate agent as these are generally more affordable than high street agencies.
No rule book states a homeowner must engage the services of a professional estate agent to sell their property. Sell your home privately or use a house buying service and there will be no agent fees to pay at all.
Port Your Mortgage. To avoid exit or early repayment fees, port your existing mortgage to the new property. Porting is fairly straightforward unless your new home is a lot more expensive than your current property.
Use an Existing EPC. If you bought your home less than 10 years ago, you might be able to use the certificate purchased by the previous owner and avoid this cost.
Hire a Van and Enlist the Help of Friends. Removal costs can quickly skyrocket. If you have a relatively small amount of possessions to transport, it might be more cost-effective to hire a van or several vans and ask a trusted friend to help you move. However, don’t be tempted to cut corners if you need the expertise of a professional company. Saving a few pounds on removal fees will be a wasted effort if you have to make dozens of trips to move everything or a valuable item is destroyed.
Use a House Buying Service. This is the fastest way to sell a house, meaning no ongoing mortgage repayments, utility bills or maintenance costs. There are also no estate agent fees and no need to spend money on improving the condition of your home. House Buyer Bureau will buy any type of property in any condition or location in the UK. Compare the costs of a sale with us to using a traditional estate agent here.
Our team of property experts will give you the best cash offer on the market. We can offer up to 80% of the market value for a quick cash sale or up to 90% for a 120-day guaranteed sale — we are the ONLY people to offer this! Contact us today for your cash offer.