For many people, moving house is something that you don’t do very often, and it can be daunting for many reasons. It’s a big change in life, and there are a lot of things that can go wrong if you’re not careful and this can be costly.  There are many financial things to consider when selling a house.  Check out these tips to maximise your finances when selling a property.

Financial Things to Consider when Selling a House

There are lots of things that can go wrong when moving house.  It's never guaranteed to be a smooth transaction and process.  Property can get lost, the selling of your house might not go as planned, you might pick the wrong 'experts', things can get very delayed, and it can be very very stressful.

Not only is it stressful, but when things go wrong it can cost you more money.  In order to make the most of the situation, you should be doing everything you can to make the whole ordeal easier on your bank account. You don't want to waste money when you are already making perhaps the largest purchase of your entire life.

Check out this list of costs to prepare for when buying a house.

Here are some things to think about when it comes to the financial side of buying a house.

Getting your mortgage

Of course, when investing in a new home, you’re going to be looking for a mortgage to pay for the home with. When doing this, it’s important that you’ve explored your option to find the most agreeable one for you.

Check out why using a mortgage broker might be the best decision for you and also these tips on how to save money on your mortgage.

If you’re someone who is struggling or dealing with bad credit, you might find it more difficult to get a mortgage for yourself. Luckily, there are bad credit mortgages available and can be a way for even those with poor credit to have an easier time getting a property of their preference. It can be difficult to get past, even when you’re doing better financially - and luckily these are a good way to get what you need.

Picking your services 

Obviously, not everyone has the know-how or the means to deal with the moving of the house all by themselves. There’s a lot that goes into selling a house and moving out, and unless you’re fully equipped - which is highly unlikely, you’re going to need to invest in someone else’s services. First of all, you need to consider your real estate agent. You want someone who can help you get your house on the market, and also provide some insight on what you can do to make your house more appealing.

On top of that, you’ll want to consider your removal company charges. Remember you’re trusting someone with all of your property, so it would be best to make sure you have a company that you’re ready to put that trust in. Of course, a better quality service might set you back a bit, so you should consider what’s more important to you.

It's not all about picking the cheapest services, but here are several tips on how to save money when selling your home.

Save money on removals

Removal services are expensive, but you can make them cheaper. In fact, if you’re not going to move very far away, you might consider asking someone to help you move instead. Anyone with a bigger vehicle that can carry your belongings may be enough, and it might not take very long. On top of that, if you were to pay them, it would likely be cheaper than a removal service. 

If you are competent, then you can hire a van and move yourself.  For our pending house move we have worked out it will be half the price for us to move our own belongings in a van into storage for two months, compared to the cost of hiring a professional movers.  This is a considerable saving. 

Check out all these ways you can save money on removals. 

Getting a higher price when selling

It can help a lot if you can add some numbers on top of the current value of your house, and investing in it before you sell might be a good idea. Small renovations, repairs, and similar changes might help to fetch a higher price when the time comes to sell.

Make sure you're aware of the different home improvements and their effect on the value of your home to ensure you get a ROI.  You can always ask estate agents for their advice when it comes to improving your home and how much its value will increase by.  This will ensure you don't spend money unnecessarily and fail to get a return.

 

Managing legal fees

One of the unavoidable costs of selling a property is the legal fees associated with conveyancing. This process involves the legal transfer of property ownership from one person to another. You’ll need a solicitor or a licensed conveyancer to handle all the legal work involved in selling your home. The fees can vary depending on the complexity of the sale, so it's worth shopping around to find a reputable professional at a reasonable price.

Make sure to get a clear breakdown of all the costs involved upfront to avoid any unexpected charges. It's important to note that while opting for a cheaper service might seem like a good way to save money, you don’t want to cut corners when it comes to legal matters. Inadequate legal advice can lead to delays or even jeopardise the sale altogether, which can be costly in the long run.

Estate agent fees

Estate agents can be a valuable asset when selling your home, but they come at a cost. Their fees typically range from 1% to 3% of the sale price, so it’s important to factor this into your budget. While it might be tempting to go with the estate agent who offers the lowest fee, it's crucial to consider what services they provide and their track record in selling properties like yours.

A good estate agent can help you get the best possible price for your home and make the selling process smoother. If you prefer to save on estate agent fees, you could consider using an online estate agent or even selling the property yourself. However, this approach might require more effort and expertise on your part.

Preparing for unexpected costs

When selling a property, it's wise to set aside a budget for unexpected costs that can arise during the process. For example, you might need to pay for additional surveys, repairs, or cleaning services to make your home more appealing to buyers. Sometimes, buyers may also request repairs or replacements as part of the sale agreement, which could lead to further expenses.

Additionally, if the sale of your home falls through at the last minute, you may still be liable for some of the fees and costs, including those for the estate agent or solicitor. By having a financial buffer in place, you can manage these unexpected expenses without too much stress.

Tax implications

Selling a property can have tax implications, especially if the property isn't your primary residence. In the UK, for example, you may be liable to pay Capital Gains Tax (CGT) on any profit made from the sale of a property that isn’t your main home. The rate of CGT depends on your income and the gain you make on the sale, so it's essential to understand how much you might owe and plan for this accordingly.

If you're selling your main home, you’ll usually be exempt from CGT, but it's always best to consult a financial advisor or tax professional to clarify your situation and avoid any surprises. Being aware of the tax implications in advance will help you manage your finances more effectively.

Timing the sale

The timing of your property sale can significantly affect how much you make from it. Property markets fluctuate throughout the year, with certain times being more favourable for sellers. Generally, spring and early autumn are considered the best times to sell, as the market tends to be more active, and homes often sell more quickly and at higher prices.

However, local market conditions can also influence the best time to sell, so it's worth consulting with your estate agent to get a sense of the current market trends in your area. If you have the flexibility to choose when to sell, timing it right can maximise your profit and minimise the time your property is on the market.

Closing the sale

Once you've found a buyer, the process of closing the sale involves several steps that can incur additional costs. These may include finalising the conveyancing, paying off any outstanding mortgage on the property, and settling any final bills or charges. It's important to have all your finances in order and be prepared for these final expenses to ensure a smooth closing process.

By taking these steps into consideration and planning carefully, you can navigate the financial aspects of selling a house with more confidence. Being proactive about managing costs and maximising your returns will help you make the most of this significant life change.