Estate agents fees rising faster than all other costs of moving except stamp duty
The average fee paid to estate agents has increased by a huge 60% since 2005.
According to a survey by Post Office Money, the average fee paid to an estate agent is now £5,697.
In the same period, the cost of a survey has risen 34% from an average of £470 to £627, with the average conveyance cost rising 36% from £1,095 to £1,486. Missing out most, the cost of removals have risen a comparatively paltry 17%.
Despite the quoted 116% rise in the average stamp duty cost, estate agent costs still make up more than half the cost of moving.
In all, moving costs twice as much as people expected to pay, with home buyers spending average £13,219 on moving home, compared to the £7,496 they expect. The cost of moving has increased by 65% over the last decade, though costs have fallen 19% in last year due to stamp duty reforms.
Post Office Money’s Cost of Buying & Moving study, compiled by Post Office Money and the Centre for Economics and Business Research (Cebr), found these costs increased from £8,025 in 2005 to £13,219 by the end of 2015, though they are lower year-on-year because the average stamp duty bill falling from £8,166 to £4,372 has brought the overall cost of moving home down from last year’s high of £16,381.
But despite this fall in costs, 85% of prospective home buyers are still underestimating the amount they will need to set aside. Those hoping to buy in the next three years expect to spend just £7,496 on moving costs – just over half (57%) of what they should actually be budgeting.
Those hoping to move in the South East have been hardest hit by these increases, with costs having more than doubled in the last 10 years (from £9,267 in 2005 to £18,710 in 2015). But London remains the most expensive place to move home with an average cost of £30,770.
John Willcock, Head of Mortgages at Post Office Money, said: “It’s easy to focus so much on saving for the all-important deposit that people forget the additional costs that come with moving, particularly for first-time buyers who have never been through the process before.
“Planning ahead is vital and potential home buyers should factor these costs in early on to avoid being faced with stressful, last-minute bills.”
“Forecasts indicate that the cost of buying and moving will only continue to rise over the next five years, even with the impact of revised stamp duty rules introduced to reduce the impact on prospective buyers’ wallets. With research indicating that 85 per cent of these buyers have underestimated how much they should budget for these costs, many could be left out-of-pocket at a time when they are already financially stretched.
“We are aware of the barriers that people can face when they are looking to purchase their first home or move further up the ladder. This is why we offer a range of different mortgages aimed at a wide variety of buyers.”