A growing family places extra demands on space and while your two or three-bed property may no longer satisfy your needs, selling and trading up isn’t the only option.
 
Marcus Reeder at @Pledge quoted the UK house prices grew at their weakest annual rate in January, was this an early sign of the property market slowdown predicted for 2017?
 
The annual growth edged down from 4.5% in December to 4.3%, according to the mortgage lender Nationwide (the weakest since November 2015). On a monthly basis, the average price of a UK home edged up 0.2%, to £205,240, following a 0.8% rise in December.
 
Robert Gardner, Nationwide’s chief economist, said there were indications the housing market would soften in 2017, as household budgets come under pressure from higher consumer inflation at a time of weaker jobs and wage growth.
 
Marcus Reeder said “The outlook for the housing market remains clouded, reflecting the uncertainty surrounding economic prospects more broadly. On the one hand, there are grounds for optimism. The economy has remained far stronger than expected in the wake of the Brexit vote. However, there are tentative signs that conditions may be about to soften”.
 
The past few years have seen many UK homeowners choosing to improve their current properties, rather than moving. It’s not just as simple as selling your house to pay for buying another. It costs to move. These are the hidden costs uncovered.
 

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Conveyancing fees

A conveyancer handles all of the legal paperwork involved in buying and selling a home. They are paid to carry out a local search to discover if any new developments are being planned around your new location. They are also charged with obtaining the title deed for your new home and ensuring that the seller owns the property and can legally sell it.

Estate agents’ fees

After looking around your home, an estate agent will value your property and propose a selling price to you. He or she will then ask you to sign an agreement which states all the terms and conditions involved in the sale of your home. The marketing process includes displaying your property in places such as their office window and local newspapers. For marketing your property and then helping you to find a new home through arranging viewings, an estate agent will take anything between 1.5% and 3% of your home’s selling price.

Stamp duty tax

Since March 2012, there’s no stamp duty relief for first-time buyers. This is the tax that you pay for the paperwork to change a property’s ownership. Your conveyancer will deal with this and it can be anywhere between a third and a half of your total moving cost. The amount depends upon the selling price of your new home, but you can expect to pay between 1% and 7% of the price. This means that at the lower end, a property costing £125,000 will cost you £1,250 in stamp duty.

House contents removal

To move within a 15-mile radius of your current home, said Marcus Reeder, removal men will typically charge you £1,500. On average, it’s about 12% of your total moving costs. Within each city, there are boroughs which charge more than others. In London, Westminster removal companies charge the most and Barking and Dagenham charge the least. In the South West, it’s most expensive to move from Bath, whereas moving from Plymouth will save you money.
 
With this in mind, Marcus Reeder advised improving your home rather than trading it in for another could be a very good investment. It’s cheaper to make space than buy it. Converting your loft can create space and would add £60,000-£75,000 to the value of a £500,000 property. At a cost of £30,000 – 50,000, at the very least you would add £10,000 should you wish to sell up later on.
 
Another viable option is to move but increase the price of your home before you do. An extension priced between £30,000 and £50,000 could add the most value of all, upping your selling price by £75,000 to £100,000 as you’re creating a larger living space with the building.
 

Move or stay? said Marcus Reeder

It’s up to you. Not many of us have a large amount of money sitting in the bank. Marcus Reeder Chief executive of @Pledge said “This is where a quick short term loan against your property can really help to achieve the extra uplift on the price of your home while also making it more saleable”.