When you buy a home you have one figure in mind: the sale price. Yet other items are paid up to the day of the title transfer and in the first month after you move in. If they are not known from the start, the budget gets tight at the last moment. Here I set out which costs arise and what I pin down for each; the current rates and amounts I give you in writing at the start of the process.
Title deed fee
By law the title deed fee is charged to the buyer and the seller separately. The parties may write a different split into the contract. This is often left to the last day, and it leads to tension.
I give both sides a written summary of the current rate and amount at the start. Who pays what is settled at the offer stage; on the day of the transfer nobody meets a figure they did not expect.
Alongside the fee there are small items paid at the time of the transfer. I write those into the same summary, so you see the total on a single page.
Valuation and mortgage costs
If you take a mortgage, the bank requires a licensed valuation report and charges an arrangement fee. These two items arise when you apply for the loan.
The point to watch is the valuation. The loan amount is set by the valuation, not by the sale price. If there is a gap between the sale price and the valuation, you pay that gap in cash.
So I suggest you work out your deposit not only on the sale price but also allowing for a possible gap. I follow up the valuation, the mortgage and the title transfer throughout, and I write to tell you which stage we are at.
Agency fee
The agency fee is calculated on the sale price and set out in the contract. The terms are agreed in writing at the start.
There is no charge for viewings. I prefer to talk about the fee at the beginning of our conversation, not at the end. Both sides then go forward knowing what is paid for what.
I also write into the contract what the service covers. It covers shortlisting the homes that suit you, reading the layout and the light before each viewing, the offer and the negotiation, and following up the valuation, the mortgage and the title transfer.
Insurance, utilities and the service charge
Compulsory earthquake insurance is taken out before the title transfer. It is a small item, but it has its place in the sequence; if it is forgotten, the day of the transfer is held up.
Transferring the electricity, water and gas accounts takes small steps that have to be done on time. I give you a list before handover showing which document goes where. That way the home is ready to use on the day you move in.
On an estate the service charge starts in the first month; a buyer focused on the sale price often remembers it only after moving in. I ask the management what the charge covers and whether any extra payment has recently been approved. If one has, we discuss at the offer stage who will bear it.
Works and moving
Most homes become liveable with small touches; some do not. On the viewing I tell you, as an interior architect, roughly what each job would cost. You build your budget on that before you make an offer.
Moving is an item too. Removals, together with first purchases such as curtains and lighting to fit the new home, add up to a considerable sum. These should go on the list from the start as well.
If works are needed, we also talk about how long they will take. The time you stay in your old home until the work is finished is a hidden part of the budget.
The budget in one table
I suggest you bring all these items together in a single table. If the table is filled in before you make an offer, you also know how far you can go in the negotiation.
Set your upper limit on the total cost, not on the sale price. Of two homes at the same price, the one that needs work is in fact the dearer one.
We fill in the table together. A row left empty points to a question we have not yet asked.
- Sale price
- Title deed fee and transfer costs
- Valuation report and mortgage arrangement fee
- Agency fee
- Compulsory earthquake insurance and utility transfers
- First month's service charge, works and moving
When you write these items next to the sale price, you see what the home will really cost you. In our first meeting we fill in this list together for your own situation, and I give you the current rates and amounts in writing. You make your offer knowing the figures.
Damla Sübar
