They say that buying a new home is one of the most stressful things you’ll ever do. Having been through it a couple of times myself, I can attest to it! However, it’s nothing compared to the wonderful feeling of stepping through your front door for the first time. When you finally get the keys to your new home and your new life, it’s like nothing else. The reason for a lot of the stress is money related (isn’t it always?) There are strict budgets and costs involved with moving house. So, if you’re thinking about making the move, here’s how to budget for the big event.
To buy any house, you’ll need a sizeable deposit. Gone are the days of getting a mortgage with no down-payment. Whether you’re new to the property market, or you’re moving on, the bigger your deposit, the better. With a large deposit, you can borrow more money from your lenders. Not only that, but you can use it as a bargaining chip with your realtors. So, your first budgetary consideration is stretching your savings to build the biggest possible deposit.
Fees and commissions
If you’ve never been through the process of moving house before, you’ll be unfamiliar with the fees. This part may just take you by surprise. There are lots of people to pay along the journey. Not least your estate agents, solicitors, and surveyors. Estate agents take a commission based on the sale price of your property. There are also electronic transfer fees to consider here. Solicitors are necessary to draw up the contracts and sign the deeds. They’ll also arrange your surveys and valuations, each of which cost money. Every house is different, but these bills will amount to thousands during the process.
Tax and stamp duty
When you buy a house, a certain percentage must be paid to the government in the form of tax. It kicks in at a certain threshold, and varies from country to country. It also increases as the value of the house goes up. Use a stamp duty calculator to determine the cost of your impending tax bill!
Monthly mortgage payments
Once the sale is finalised, you can finally move in and settle down. However, the budgeting doesn’t end there! Now, you’ve got to start making those monthly repayments to your mortgage lenders. Again, the amount here varies according to your house and lender. Interest rates are different across the board. For a rough idea of current average interest rates, take a look at https://www.tomorrowfinance.com.au. Paying back your mortgage requires a minimum monthly payment, but we advise paying as much as you can.
The last thing on your budget ought to be your utility bills. This is gas, electricity, phone bills etc. If you’re moving to a new area, get hard quotes, and build them into your budget. Balance them alongside your mortgage repayments, and make sure the accounts work for you.
If you’ve got all the figures and sums adding up, congratulations! It’s often a tight squeeze, but it’s all worth it when you move in.