Fees to consider when buying a property

There are many factors new homeowners or investors look for when they want to buy a property. There are also additional fees to consider on top of the purchase price of a residential property such as stamp duty.

What is Stamp Duty Land Tax?
Stamp Duty (SDLT) is a payable tax on residential properties in the UK, the rates will differ for first-time buyers or property investors.  Stamp Duty is paid on properties that exceed £250,000 the rate ranges from 5% to 12% of the purchase price. The amount of stamp duty you pay also depends on:

• how much you paid for the property
• when you bought the property
• whether you’re eligible for relief or an exemption

SDLT Rates from 23^rd September 2023

Mortgage fees
On top of your mortgage interest rates, there may also be mortgage fees you have to pay which can range from £0 to over £2,000. It is always a good idea to shop around when looking for a mortgage provider as every mortgage provider may have different rates, credit report fees and much more

Legal Fees
When purchasing a property, you will have to instruct Solicitors to complete your house-buying process, this is called conveyancing.  In the UK Solicitors’ fees can range from £500 – £1,500, disbursements will also need to be added to this fee. This could bring your total legal fees to over £2000. Some of the most common disbursements can include, anti-money laundering checks, searches, transfer of ownership and much more.

Tips to keep Legal fees down:

• Shop around and research, try to contact a few Solicitors/conveyancers to compare their rates and fees
• Negotiate, don’t be scared to negotiate the conveyancing fees, some companies may offer discounts which are not stated on their websites
• Check if disbursements are charged and included within their legal fees and ask for an itemised quote

Lender valuation fee
If you require a mortgage to purchase your property your mortgage provider will request a    property inspection and survey to be carried out on the property. This is done so your mortgage lender can determine whether your property is valuable enough to secure the loan you have requested.

The surveyor may consider the following:

• The type of property (e.g., house, flat, bungalow)
• The condition of the property (e.g., poorly constructed, location considered a risk, leasehold property)
• Sales data of similar properties in the area

The survey completed by the lender is not full and you may or may not receive a copy of the survey this will be determined by your lender.

Lender’s valuation cost

You may be lucky to find a lender that will charge a minimal fee, lenders’ valuation fees can cost up to £1500.