Selling a house is more expensive than some people think.
But what are the costs of selling a house? Can any of them reduced?
Read on to find out.
How much does it cost to sell your house?
There are many different factors which impact how much it costs to sell your house.
On average, the direct cost amounts to between 1.5 – 3% of the final selling price.
However, there are indirect costs, too, for example:
- Money lost by lowering your selling price during negotiations
- Money spent on accommodation (if you sell your property before buying another
- Money spent on bills and maintenance (if you move to another property before yours sells)
And more.
Example house sale cost
Each sale is unique. But let’s assume you are in the following situation:
- Your 3-bedroom property is being sold for £500,000
- You are a higher rate taxpayer
- You are moving less than 25 miles away
- Your property has increased its value by £100,000 since you bought it.
In this scenario, your costs would be as follows:
- Conveyancing: approx. £800
- Estate Agency: approx. £6,500
- Removal Company: approx. £550
- Energy Performance Certificate: approx. £40
- Capital Gains Tax: approx. £26,000
These figures added together come to £33,890.
The two largest fees (estate agents and capital gains) are subtracted from the sale’s profit.
Breakdown of costs
1. Conveyancing fees: approx. £800
In most cases, a conveyancer will set their fee depending on property’s valuation.
So, more expensive homes have higher fees.
This reflects conveyancers’ increased liability and professional indemnity insurance costs.
The typical UK cost for a conveyancer when selling a residential property is around £500 – £1000.
You may have to pay further legal costs, known as disbursements.
2. Estate Agency: approx. £6,500
When you sell your property on the market, your estate agent will take a percentage of the house sale as commission.
One study found that the average UK estate agency charges 1.18% commission. However, this figure can go anywhere up to 3%.
If you sell a house for £500,000, the average estate agency will charge between £5,900 and £7,500. This figure will go up or down in proportion to your house’s value.
3. Removal Company: approx. £550
This average applies to a removal for a 3-bedroom house in the UK, with a short distance of up to 25 miles.
You will often need to pack and prepare your belongings and furniture yourself.
In other words, it is not the same as the removal company packing for you. This service costs 2 -3x more.
The cost of a removal also varies depending on the size of your property. And the distance that your belongings are being transported.
Many removal companies provide free quotations
4. Energy Performance Certificate (EPC)
An EPC, is a vital document required to sell your house.
On average in the UK, this certificate typically costs at least £35 to acquire, but can sometimes be more.
Capital Gains Tax
In most instances, when you sell your permanent residence, there is no Capital Gains Tax.
However, there are a few situations where you may have to, such as:
- If you have sub-let part of it
- If you are using the property as business premises
- If you have another property which could be viewed as your main residence
- If the house includes lots of land/additional buildings.
In 2023-24, the capital gains tax allowance is £6,000, less than half what it was in 2022-23. This is the amount of profit you can make from an asset this tax year before any tax is payable.
Capital gains tax is charged at 18% for low-rate taxpayers and 28% for higher rate taxpayers.
Is there a cheaper way to sell my house?
Selling your property to a cash buyer like We Buy Any Home brings less expenses. It is one of the cheapest ways to sell your house (in terms of fees).
We will sell your house fast while helping you save on legal fees and estate agency commissions. Thishelps to counteract the slightly-below-market-value you receive..
