Buying new homes off plan
The amount of money you can spend on buying your new home will depend on how much money you have saved and how much a bank or building society will lend you. When deciding how much of a mortgage they are willing to offer you the lender will take into consideration.
- the amount of deposit you can put down
- your salary
- your regular outgoings
Lender's attitudes vary, but if you're applying for a mortgage on your own they will usually lend you between 3 and 3.25 times your annual income before tax. If you're applying with somebody else, they will usually lend either between 3 and 3.25 times the main income plus the second income or 2.5 times the two incomes added together.
You'll also need to factor in additional costs such as
- solicitor fees
- stamp duty
- surveyor's fee
- land registry fee
- packing and removal costs
Here is a checklist which includes some approximate costs. Many of the figures, for example the surveyor's fees, will depend on the size of the property and its' location.
Costs of buying a home
| Arranging the mortgage |
from £200 up to £1,000 |
| Legal fees |
from £400 for selling and £500 for buying |
| Land registry fee |
£220 |
| Other searches |
from £70 |
Local authority search fee
| In London |
Around £200 |
| Rest of England and Wales |
Average £140 |
Stamp duty
| Residential property - purchase price |
Rate of Stamp Duty Land Tax |
| up to £125,000 |
0% |
| £125,001 - £250,000 |
1% |
| £250,001 - £500,000 |
3% |
£500,001 or more |
4% |
Survey
| Mortgage valuation survey |
from £170 |
| Homebuyer's survey |
from £300 |
| Full structural survey |
from £400 |
Finally, it is always a good idea to have an emergency fund to cover any cost-overruns or unexpected expenses.