It is not unusual to want (or to need) to achieve more than one outcome from selling your property. Getting the best sale price is, unsurprisingly, usually one.
However, in concentrating on finding the buyer who offers most and the waiting for the housing market to rise, sellers sometimes forget that all the costs of selling can make a difference to the amount you ultimately receive. The main disbursements when selling your home will be for transfer of ownership and the title deeds copy.
There is no exact figure for cost of selling your poperty. The cost of selling a house depends on how much of the sale process you are willing to handle yourself. We estimate that the average cost is usually around £1,200 plus 2% of the value of the property. (Learn up on DIY conveyancing before you decide to handle the conveyancing process yourself.
This article, which is part of a series of articles on conveyancing, takes a closer look at how much it costs to sell your home - what you will expect to pay for and how you can reduce fees and expenses.
Early repayment charge
If you are still within the existing mortgage term of your fixed interest rate, then you may have to pay fees for terminating your fixed term early. This is known as early repayment charge. It can be anywhere between 2% - 5% of the your outstanding mortgage debt.
You may wish to learn more about early repayment charges as it can seriously affect your decision to sell a house. It has been explained throughly in our guide on how to remortgage.
Mortgage exit fee
The mortgage exit fee is likely to be lower the closer you are to the end of the fixed term. If you are on the standard variable rate (or if you have no mortgage), you shouldn’t have anything to worry about.
If you can be flexible about when you sell, it is better to sell towards the end of the term of the fixed rate, or outside it. If you’re about to rearrange your mortgage in order to benefit from a fixed rate, but anticipate that you may want to sell before the term ends, then you could look for a mortgage that is “portable”. Such an agreement allows you to carry over your rate of interest to a new property for the remainder of the term without any additional costs should you sell.
You also need to consider that remortgaging before you sell may still incur fees for you now. Read our article, how to remortgage, to find about other costs associated with remortgaging.
Removals (and possibly storage)
Removals companies cost varying amounts depending on the location of your property, how much furniture you have, and the level of service that they provide to you.
Obviously, the more work that you can do yourself, the less you need to pay a removals company to do.
To keep removal costs down:
Consider the minimum level of service
It may be convenient to have somebody else pack and take away the contents of your home, but a full service generally comes at a higher profit margin for the removals business.
Obtain several quotes
Don’t just ask your local removals business to carry out the work. Also obtain written fixed fee quotations from other businesses in the surrounding area. If you are moving area, you might also consider asking for quotes from removal firms in the new area to which you are moving.
In order to keep removal costs down, some removal businesses insist that your furniture and possessions are packed in a particular way and left somewhere convenient to take them out the property. They may charge you fees if you don’t comply. So check the terms and conditions of your contract.
Disassemble your furniture if possible
Not only will it take up less room in the removals van, but the removals firm is likely to quote less for moving it.
Estate agency fees
The traditional high street agents take commission on the property’s sale price. The average fee these estate agents charge can be between 1% and 3% of the final sale price, but of course you pay nothing if your home is not sold.
When choosing an estate agent, you shouldn’t just choose the firm that provides the highest valuation of your property or simply because he or she is a high street agent. You should also consider the fees that the estate agent will take. There is no benefit in holding out for a higher price with an estate agent agent who will take the additional amount as commission.
Remember that you can negotiate fees the estate agent will charge, and that most estate agents will expect that some of their clients will do so. Especially if a competing firm can offer you a lower rate, don’t be afraid of asking your preferred estate agent to drop his or her fees by a percentage point.
As estate agent contracts can be complex, it would be wise to go through our guide on what to watch out for in estate agent contracts.
Further, while many people go with traditional estate agent, you can get the same services through an online estate agent as well.
Online estate agents
If you are willing to put up a board and show potential buyers around, you might also consider using online agents (sometimes also called "hybrid estate agents").
Online estate agents fees are typically much lower fees than a local firm. Some even offer fixed fees. Of course, you won’t have exposure in a local agent’s window, but most people look online now before then making a viewing appointment with the agent.
Conveyancing costs can vary significantly and tend to be higher for larger properties. Further, how much the property sells for also has an impact of total cost of selling.
A Licensed Conveyancer will carry out the same work as a conveyancing solicitor but usually charge less legal fees. However, there is a crucial difference between a licensed conveyancer and a conveyancing solicitor, which is also contributing reason to why solicitor fees are higher.
Opting for the cheapest conveyancer doesn’t always save money. A good conveyancer can ensure that the transaction goes through smoothly and quickly, and that the buyer’s conveyancer does not feel that he or she can ask for reductions in the offer price.
Usually you can save money on conveyancing fees by asking the same conveyancer to act for you for both the sale of your existing property and the purchase of your new property. The two properties do not need to be in the same area.
You can also shop around for a conveyancer. Your estate agent is likely to recommend a local one, with whom he or she has a good relationship. Bear in mind that he or she might also receive commission for introducing you. However, your conveyancer does not need to be local to you or the property – conveyancing can be done at distance through online conveyancing. (You may wish to read about how online conveyancing works and how much does it cost compared to their solicitors and licensed conveyancers).
As a seller, you should expect to pay in the region of £500 to £750 for conveyancing. The buyer is likely to have to pay more because his or her conveyancer will have to carry out more work, such as conducting searches.
Conveyancing is a competitively priced service that has low profit margins. While you can (and should) ask for a reduction in the fee, most conveyancers are not likely to be flexible on prices.
However, you can find licensed conveyancer who work on a no sale no fee basis. To find out what it exactly means, read our article, no sale no fee explained.
You may also wish to read our guide on conveyancing process for sellers.
Energy Performance Certificates (EPCs)
Having an Energy Performance Certificate has been a legal requirement for selling a property for a number of years. They generally cost between £60 and £120. It is a report on the energy efficiency of the house.
A lower priced one will generally just give a rating. A higher priced one may also give advice on how to improve specific areas of the property to increase the rating in the future, and many buyers appreciate this additional information. So paying a little bit more for a comprehensive EPC may be worth it.
Other costs you may have to consider
Depending on your circumstances, there may be additional costs of selling. For example:
childcare (and/or pet-sitting) on removal day
furniture storage costs
hotel costs or holiday home rental costs if you don’t move into your property on the same day that you leave your old one
A bank transfer fee to your solicitor or licensed conveyancer (whether for paying off your mortgage or paying the final sale funds into your account)
capital gains tax (if the property has increased in value)
You may wish to read on what is Capital Gains tax to have a better idea of how Capital Gains tax works.