As mentioned above, when you buy a house in England, one of the first things you will have to pay for is an inspection to make sure the property has no structural problems. There are three different types of inspections: from a simple loan evaluation, through a buyer’s report, to a full structural inspection. Depending on the option you choose, the price can vary from £300 to £1,000.
Of course, your notary will charge you for his services. And since prices vary enormously, it is a good idea to get a few quotes before committing to a particular lawyer.
However, the biggest expense involved in buying a property is the payment of stamp duty. Currently, the amount to be paid is calculated according to the following scale:
- 0 £ – 125 000 £ 0 %
- 125 001 £ – 250 000 £ 1 %
- 250 001 £ – 500 000 £ 3 %
- 500,001 – £1 million 4 %.
- 1 million £ – 2 million £ 5 %.
- Over £2 million 7% 7%.
- Above 2 million and purchased through a company 15%.
When you sell, you will have to pay your notary again, as well as a real estate agent to sell the property. Generally, they take about 2% of the asking price plus VAT, but again, it is worth checking with several agents.
You may have to pay the tax rate on capital gains. Taxes vary from 10, 20 to 40% depending on your income.
However, everyone is entitled to a non-taxable amount of £10,600 after deducting expenses. So it may be better to buy as a couple rather than individually. Consult a tax advisor to see if you will have to pay this tax because each case is unique.
New construction versus resale
Due to the recession, there are no longer as many new buildings to choose from as there were five years ago. If you are looking for a home to move into directly, then a new property may be the best option.
New homes also have a 10-year NHBC builder’s warranty, covering your property against any defects during this period. New homes are often the preferred option for those looking for a place that is easy to maintain, as they do not require as much maintenance as older properties and you can move in immediately without having to worry about DIY or renovation.
On the other hand, old properties will always be rated higher because of their character. The English are very good at preserving original features such as fireplaces and mouldings. As a result, these homes are very popular and often cost more than a brand new home.