Many underestimate the cost of moving home
It found that total moving costs increased from £7,590 in 2006 to £9,472 by the end of 2016, and noted that the hikes would have been significantly higher if not for government changes.
The removal of the Stamp Duty “slab” system, which saw all homeowners charged at a percentage of the price paid for their property, resulted in the average Stamp Duty bill falling from £4,227 at the end of 2014 to £1,774 at the end of 2016.
Post Office Money predicts that the additional costs of moving will hit £12,267 by the end of 2020 and would-be buyers will face an even greater challenge for the amount they need to set aside.
But a worrying two-thirds (65%) of prospective home buyers are still underestimating the amount they will need to set aside.
One of the most significant moving costs to increase over the past 10 years is the fee charged by surveyors. This cost has jumped by 53% since the end of 2006 (from £498 to £764 in 2016).
Costs soar in the South East
Those hoping to move in the South East have been one of the hardest hit by increases, with additional costs rising by 72% in the last 10 years (from £8,809 in 2006 to £15,114 in 2016). But London remains the most expensive place to move home with an average cost of £26,673.
The additional costs of moving home remain the highest in London and residents of the capital are the most likely to underestimate the additional costs, with prospective buyers in the city budgeting £8,838, significantly less than the £26,673 they should expect to spend.
Owen Woodley, managing director at Post Office Money, said: “Forecasts indicate 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 65% of these buyers have underestimated how much they should budget for these costs, careful and considered budgeting is essential at a time when they are already likely to be financially stretched.”