You might think the cost of moving home starts and finishes with a deposit and stamp duty, but think again. The true cost of moving includes a host of add-ons that you are going to need to pay for upfront. Many are taken by surprise by buying costs, especially when faced with forking out for additional “hidden costs” that can add up to £1,000.

The big hurdles

Deposit and stamp duty Most mortgage lenders expect first-time buyers to put down a deposit of at least 10 per cent. According to the latest research from Halifax, the average deposit for first timers in London stands at a staggering £109,885.

Increasingly, lenders want to see evidence that first-time buyers have saved up their own deposit, not just been gifted a lump sum by the Bank of Mum and Dad, as proof of their ability to save and manage their money.

One way around the deposit conundrum is to buy a new home under the Help to Buy scheme. This offers a Government loan and cuts deposit requirements down to five per cent - although you will have to start repaying your loan after five years.

Traditionally the other big start-up cost is stamp duty, paid by buyers to the Government. However, until next March, buyers of homes costing £500,000 or less are exempt from the tax, which means that most first-time buyers can forget about stamp duty for now.

Professional fees

You can’t manage a property sale alone, and the cost of professional fees can really stack up.

Buyers don’t usually pay estate agents. Buying agent Rebecca Stott of FoundIt London, who specialises in finding first-time buyer homes, warns novice buyers to watch out for properties listed as “for sale by tender”. This means the buyer takes on the agent’s fee on top of everything, and she tends to avoid these homes.

Legal fees

You will need a solicitor to push the sale through. Legal fees vary, so do shop around. “A £500,000 flat, for sale or purchase, would be around £1,000 plus VAT if you used The Partnership, who I always recommend as a really good middle-of-the-market option for my clients,” says Christian Eldershaw, partner at the Hackney and Haringey branch of estate agents Mr and Mrs Clarke.

Surveys

You should also invest in a structural survey to check out the state of the property. Rebecca Stott says it is essential to use a firm accredited to the Royal Institution of Chartered Surveyors. According to latest data from home moving quotes website Reallymoving, the average cost for a London first-time buyer comes in at £450.

Unless you are buying a new-build home, do not be tempted to make do with the mortgage valuation, because they are just not detailed enough. The good news is that if a survey throws up problems you can use it as a bargaining chip to reduce the price of the property.

Local authority searches

You will also need to pay for local authority searches, to check, for example, on whether there are any major nearby developments on the horizon that could impact on the property. Your solicitor will arrange this but you will foot the bill. According to the HomeOwners Alliance these cost anywhere between £50 and £250.

Also bear in mind that some mortgage companies charge for their valuations and/or set-up fees for loans, so check what they might want from you. The cost can be £150 to £1,500, based on the property’s value, according to the Money Advice Service.

And if you thought the cost of the property was bad enough, you’ll also have to pay £40 to £50 for an electronic transfer fee, to get your mortgage money sent to your solicitor.

… And the rest

· Removals are a major cost. Reallymoving’s research found that the average London first-time buyer spent £241 – although clearly this will vary wildly depending on whether you have just a couple of car loads of stuff or a whole flat full.

· Do not forget insurance for your new home. You will certainly need contents insurance; the cost will depend on the size of the property and how much stuff you own. Buildings insurance for a flat is usually dealt with by the freeholder, and paid for annually. “A two-bed flat should cost around £350 to £400 per year,” says Rebecca Stott.

· Flat buyers usually agree to buy out the remainder of the current year’s premium from their seller, and then start paying the full fee when the next year’s payments are due. The same usually goes for service charge and ground rent, but your solicitor will be able to advise.

· Getting your post redirected costs £68.99 per year.

· You will need to register for council tax straight away, and pay off the utilities bills at your old home. Your new set of bills will soon start arriving, too. If you can, get refunds on council tax at your old place, as well as for things like car parking

permits you can no longer use and insurance policies you no longer need.

· You will need to buy furniture for your home. If you are on a budget, ask to buy kitchen white goods from the seller. Second-hand washing machines or fridges won’t last forever, but should be cheap and will tide you over. Don’t pay more than £100 unless there’s a very good reason - for example, if the item you are buying is almost new. The same goes for blinds and curtains, which probably won’t fit the seller’s new windows; shelving, light fittings and anything else you like the look of.

· For low-cost furnishing turn to friends and relatives who might have stuff to give away. Also, look at Gumtree and eBay, and don’t forget about live auctions. Find your local auction house on thesaleroom.com and you can buy up antique and second-hand furnishings for a steal.

· Buyer incentives: if you are buying a new home talk to the developer and see if they will throw in any freebies. Many offer furniture packs as an incentive.

· If you are lucky enough to be getting some outside space at your new home you are going to need to think about tools, planters and outdoor furnishings – and at this time of year you will find some very good deals in the sales as retailers look to shift their summer stock.

· Repairs: unless its new, the home you’re buying will have its flaws. The Money Advice Service reports that the average repair bill for new homeowners is £5,750. But, of course, you ought to have negotiated your price based on the contents of the survey and if there’s anything badly wrong with the property, that price should come down.

· Little extras, according to Rebecca Stott, include light bulbs (if your seller takes them away – many do); a locksmith because for security you should change the locks when you move in,

and a parking permit, costing £150 to £200 per year, depending on the borough.

·

And, finally, moving day is going to be tiring so you won’t feel like cooking. So do add the cost of a celebratory first-night takeaway feast to your moving budget.

Source: homes and property