Selling a house isn’t all profit and getting the best deal out of a property. It actually entails a lot of expenses that will slowly eat up whatever profit you stand to make from selling your home. If you’re not careful about it, you might end up not getting a lot of money from the sale of your house. While the cost of selling a house can largely vary, it can still amount to a significant number due to all the processing and the people you need to hire to make sure the deal pushes through.
Every cost associated with selling a house boils down to your specific circumstances and the few critical decisions you choose to make. There are the estate agent’s fees, the conveyancing costs, other inspection fees and even removal company fees. Not all these are set in stone, and you can forego some of the expenses here and do some of the work yourself, but that could require a lot of effort and time. Make sure you consider all the pros and cons of each path, as they are all worth bearing in mind.
If you’re particularly interested in these costs, here’s a comprehensive guide on the breakdown of costs when selling a house. We’ve also included some tips here and there on how you can keep these costs down.
What’s the Average Cost of Selling a House?
There’s actually no exact figure for the price of selling a house, as this entirely depends on the individual circumstances of each sale. The fact that properties are all sold at different prices also makes it hard to really come up with an average cost as they all depend on the price of the house itself. For example, you can expect to pay around 1-3% of the final sale price just to your estate agent alone. However, there are other costs involved, and we’ll break each and every one of them down.
Breakdown of Costs for Selling a House
When it comes to home selling, you can expect fewer extra costs when you’re the one selling compared to someone buying a house. However, they can still go up a substantial amount if you’re not careful about hiring the right people. To give you an idea of the costs, here’s a breakdown of them:
1. Mortgage Charges and Remortgaging
One of the first steps to follow when selling a house is to settle your finances, particularly your mortgage. There are a couple of critical points to consider when it comes to mortgages, as this is an area where most of your costs can rapidly rack up. First, you need to check two things before you even begin putting your house on the market:
If you’re still within your existing mortgage term, it’s important to check your policy to determine if there are any fees you’ll be liable for if you decide to move. This is a crucial step. Otherwise, you can contact your lender for assistance if you’re unsure what to look for in your policy.
If your mortgage is ‘portable’, then that means you should be able to move your existing mortgage onto a new property without incurring any extra costs. Of course, that is subject to the fact that your lender is happy with the new property and the price and has generally agreed to the deal.
If you’re already out of your fixed period and in a position to remortgage, then this is an excellent time to do so. You can save quite a lot by remortgaging and finding the best deals around, even if it’s just a few percent lower than your initial mortgage.
Now, there are two particular costs you need to be aware of here depending on which situation above you’re in:
Early Repayment Charges - usually 1-5% of the loan amount
Mortgage Exit Fee - anything from a few pounds up to £350
Not all lenders have these fees, but it’s important to be aware of what you’ll be paying. It’s also possible that the charges can be much higher than initially expected.
2. Estate Agent Fees
When selling your property, it’s best to work with an estate agent as things are just easier with them. Of course, you can always sell your house privately without an estate agent to reduce your expenses. However, there’s a lot more to it than you may think. Just the effort of listing and advertising your property can be quite a nightmare.
As mentioned above, estate agent fees are one of the biggest expenses you may incur when selling a home, running at around 1-3% of your sale price. So, if you’re selling your property at £200,000 and your agent charges you with a 1.5% commission, you’ll be paying £3,000 on agency fees.
An alternative is to work with an online estate agent, which is often cheaper as they sometimes have fixed fees. This comes with fewer viewings and not much personal service, but the cost averages around £500-£1500 plus VAT.
3. Energy Performance Certificate (EPC)
An EPC measures the energy efficiency of your property by giving it a rating from A to G. This is a requirement (at least, in England or Wales) when selling, and you won’t be able to list your property without an EPC. The average cost for an EPC runs at around £60-£150. The good thing about an EPC is that it’s valid for ten years. So, if you already have a valid one, you can save a few quid by reusing it for your property’s listing.
4. Conveyancing Fees
Hiring a conveyancing solicitor or a licensed conveyancer is crucial if you don’t want to be bothered with all the legal paperwork involved in your property sale. Conveyancing costs wildly differ between agencies and firms, but a typical conveyance fee in the UK goes for around £500-£1,500. More often than not, the price depends on the complexity of the situation. For example, dealing with leasehold properties is generally more complex than freehold, so expect to pay more.
5. Removal Costs
If you have a small and manageable amount of possessions that need transporting on move-out day, then you probably won’t pay as much on removal fees. However, dealing with a lot of cargo is a different story. It might be cheaper just to do the moving yourself and in batches to lessen the cost of moving. In a way, this is true, but if you have possessions that your home insurance provider does not cover, then that could cost you if it happens to get damaged while in transit.
So, if you want to avoid potential losses, hiring a professional mover would be a better option. This will cost you around £400-£1,500, depending on the size of your property and the amount of cargo. The great thing about this is, you don’t have to strain yourself in moving all your stuff out.
Considering all these things, you’re looking at a total cost of about £5,000-£6,000 when selling your house. Of course, this is still an estimate as many of these expenses will vary on a number of factors. It’s best to be prepared for all this, so you don’t end up losing a lot of money.
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