The Cost of Selling a House – A Guide to Hidden Fees

Moving house is an exciting time, but it comes with a variety of fees and costs that might surprise first-time sellers. This article aims to shine a light on the true ‘cost of selling a house’ and the hidden expenses you need to factor in when embarking on this financial journey.

In the UK, the average cost of selling a house can range between 1% to 3% of the property’s value. But what expenses does this figure include? 

1. Estate Agents’ Fees

Estate agents’ fees will make a noticeable dent in your profit. These fees are typically calculated as a percentage of the selling price of your home – this usually ranges between 0.75% and 3.0% (plus VAT). 

This range can depend on a number of factors, including local competition amongst agencies and the level of service provided by your estate agent – that is to say, it’s advisable to shop around rather than settle for the first option. 

2. Conveyancing Fees

Conveyancing is the legal process involved in buying or selling a property.

It’s crucial to any property transaction and is usually undertaken by a solicitor or licensed conveyancer.

Both are legally qualified to guide you through the complexities of property law, but while a solicitor can offer a full range of legal services, a conveyancer is a specialist who focuses on property.

Their role includes conducting searches with local authorities and utility companies to ensure there are no major problems, dealing with Land Registry, managing Stamp Duty charges and payments, and drafting and assessing contracts to ensure your interests are protected.

Costs of conveyancing services can vary widely, typically ranging from £500 to £1,500, including disbursements – the expenses your solicitor or conveyancer will need to pay on your behalf. This variation largely depends on the complexity of the transaction.

3. Energy Performance Certificate (EPC)

An Energy Performance Certificate or EPC is one of the lesser expenses when selling a property, but it is a legal requirement when selling a property in the UK. 

Costs typically range from £60 to £120, and the process involves a qualified assessor inspecting your property to evaluate elements like insulation, heating systems and lighting to establish an energy efficiency rating and offer recommendations on how to improve the energy performance of the building.  

4. Removal Costs

These will vary depending on the size of your property, and whether you opt to pack yourself or enlist the help of movers. 

But on average, a two-bedroom house will cost about £600, or £900 with a packing service. 

These costs apply if you’re moving your possessions to a new house. Depending on the volume and distance of your move, costs can range from £300 to over £1,000.

5. Mortgage Early Repayment Charges

Mortgage Early Repayment Charges, commonly referred to as ERCs, are fees that you might need to pay to your lender if you decide to pay off your mortgage before the end of the fixed, discount, or tracker rate period. 

You’ll usually pay ERCs if you’re planning to sell your home before the end of your mortgage contract, and the charge exists for lenders to recoup any losses from their projected earnings from the mortgage term. 

ERCs can be a substantial expense. Usually calculated as a percentage of the outstanding loan, you can expect this charge to range between 1% and 5%, depending on the terms of your mortgage contract. 

6. Home Staging and Minor Repairs

Cosmetic upgrades can be optional when selling your home. But if you’re looking to appeal to buyers, it can’t hurt to invest in minor home staging and repairs. 

These costs can vary widely depending on your budget and how much work is required. But remember that these additional costs can also be something of an investment into your home, potentially yielding a higher offer and helping your home to sell quicker. 

7. Capital Gains Tax

In the UK, Capital Gains Tax is applied to the profit you make when you sell a property that has increased in value, with differing rates for residential property and other chargeable assets.

You only need to worry about this if the property you are selling is not your primary residence.

For higher or additional rate taxpayers, you’ll pay 28% on gains from residential property. If you’re a basic rate taxpayer, the CGT you pay is dependent on the size of your gain, your taxable income, and whether the gain stems from residential property or other assets.

Ultimately the real cost of selling a house is hard to pinpoint, but it’s not just the price paid by the buyer. For a seller, there are a wide range of fees, taxes and charges contributing to the overall cost that ultimately take chunks out of your final profit. 

Please remember that while our guide provides an overview, costs can vary widely based on individual circumstances and local market conditions. Therefore, it’s always important to seek professional advice to get a clear understanding of the costs you can expect to pay. 

As well as being expensive, selling your home commercially can also be a time-consuming and highly administrative process. If you’re looking for a quicker way to sell your home, buying services like Zoom Property Buyer can cut out many of the above costs and complete the sale much faster than you might expect on the open market.

Finally, remember to consider alternatives like selling to a property buying company like Zoom Property Buyer, which can offer a quicker, simpler process with fewer costs involved.

However you choose to sell your home, knowledge is power in your property-selling journey. And understanding the cost of selling your home is the first step towards a successful sale.