Selling a house is slightly more expensive than some people think. While, in theory, this should be the time when money is coming in and not out, there are certain procedures you have to go through in the house-selling process – and most of these cost money.
But exactly what costs are involved with selling a house? Can any of them be sidestepped – and if not, how much will it put you out of pocket? We’ve given a clear guide to the costs associated with selling a property in the blog below.
Costs involved with selling a house
There are a number of costs involved with selling your house. These include the following:
- Conveyancing fees
- Estate Agency fees
- Removal company
- Energy Performance Certificate (EPC)
- Capital Gains Tax
We’ve gone through each cost in-depth below so you can understand why the expense is necessary and how much it may set you back.
Conveyancing fees
In most cases, a conveyancer will set their fee depending on the valuation of the property. Therefore, if your house is valued highly, then it will typically result in a higher fee. The higher costs are a reflection of their increased liability and professional indemnity insurance costs.
The typical UK cost for a conveyancer when selling a residential property is around £500 – £1000. In addition to this, you may have to pay further legal costs, known as ‘disbursements’.
Estate Agency fees
When you sell your property on the market, your estate agent will take a percentage of the house sale as commission. A study found that the average UK estate agency charges 1.18% commission on the sale of a house, although 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.
Removal Company
On average, a removal for a 3-bedroom house in the UK, with a short distance of up to 25 miles, will cost approximately £500 – £600. Although this price will cover the basics, you will often need to pack your belongings and furniture in advance of the removal company’s arrival.
Any packing service or additional materials required will cost extra. You should also keep in mind that the cost of a removal will vary depending on the size of your property, and the distance that your belongings are being transported. Contact removal companies for free quotations.
Energy Performance Certificate (EPC)
An Energy Performance Certificate, commonly known as an EPC, is a vital document which will be required when you 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 the property that you live in as your permanent residence, you do not have to pay 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.
How much does it cost to sell your house?
As we have outlined above, there are lots of different factors which impact how much it costs to sell your house. Assuming your 3-bedroom property is being sold for £500,000; you are a higher rate taxpayer who is moving less than 25 miles; and your property has increased its value by £100,000, 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. However, keep in mind that the two largest fees (estate agency costs and capital gains tax) are simply taken off from the profit you make selling the house.
Please remember that these figures are a rough estimate and may vary significantly depending on your property, location, choice of companies, the distance you are moving house, and more. Without all of these details, it is not always possible to accurately predict the average cost of selling your home.
Is there a cheaper way to sell my house?
Selling your property to a cash buyer like We Buy Any Home results in significantly less expenses than selling on the market with an estate agency. We will sell your house fast while helping you save on legal fees and estate agency commissions – which helps to counteract the slightly-below-market-value you receive.
