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Can I Afford to Move House? 7 Steps to Understanding the Cost of Moving Home in 2024

Natalie Wilson

Sep 30, 2024

1. Assess Your Current Financial Situation

Before diving into the complexities of moving costs, start with an honest assessment of your financial situation. You will want to consider the following:

Income: Ensure you have a steady income to cover not only the moving costs but also the potential increase in mortgage or rent. If you’re looking to move jobs soon or have started a new one in the last few months, you may want to wait as some mortgage lenders won’t accept an income from a job you have been in less than 3 months due to probation periods.
Savings: Have you built up enough savings or equity in your existing home to cover upfront costs like a deposit, moving fees, and other expenses? It’s recommended to have at least three to six months of living expenses saved also, in case of emergencies such as losing a job or sickness.
Debt: Evaluate your current debt levels. Do you have high-interest debt, like credit cards or loans, that should be cleared before moving? Reducing outstanding debt can free up more of your budget for the move, as this debt will count against the amount you can borrow from a lender.

2. Calculate Your Upfront Moving Costs

Moving isn’t just about paying for a new property; there are many upfront costs that can add up quickly. Some of the main expenses include:

Stamp Duty Land Tax (SDLT): In England and Northern Ireland, this tax is applicable on property purchases over £250,000, or over £425,000 for a first-time buyer. The rate increases based on the value of the property, so you’ll need to budget for this. Use Martin Lewis’s free calculator to see how much your Stamp Duty would be.
Deposit: If you're purchasing a home, you'll need at least 5% of the property's price as a deposit. The larger the deposit, the better interest rates you can access. If you’re a first-time buyer, this deposit will likely come from savings or gifted by family. If you have an existing property to sell, some or all of the equity can be used as a deposit.
Estate Agent Fees: If you’re selling your current home, you’ll need to pay estate agent fees, which typically range between 1% and 3% of the property’s selling price. If you’re buying a new home with Strata, we offer Part Exchange and Assisted Selling Plan schemes, where we could cover these fees and more.
Legal Fees: Conveyancing fees (for transferring ownership) can cost between £800 and £1,500 depending on the complexity of the transaction. This is paid per property, so if you’re an existing homeowner you’ll need to consider this will be payable on both your current home and the one you’re buying.
Surveys and Valuations: Mortgage lenders often require a valuation survey, costing around £300-£1,500, depending on the property’s value and the type of survey you choose.
Removal Costs: Hiring a professional removal service can cost between £300 and £1,500 depending on the distance of the move and the size of your belongings.

3. Monthly Running Costs

Beyond the upfront costs, it's essential to consider your ongoing monthly expenses in the new home:

Mortgage Payments or Rent: Can you comfortably afford your new mortgage payments or rent? Our mortgage calculator can help you estimate what you’ll pay, including interest and repayments.
Council Tax: Council tax rates vary by local authority, property size, and location. You can check with your local council for the exact amount.
Utility Bills: Depending on the size, age and energy efficiency rating of your new home, utility costs may change. Larger homes can come with higher heating, electricity, and water bills. Older properties often have lower EPC ratings, where as a new build would usually be rated A or B due to modern build methods and materials making it more energy efficient.
Insurance: Home insurance (building and contents) is essential to protect your investment, and premiums will vary depending on the location and property type.

4. Cost of Living in the New Area

Moving to a different part of the UK could significantly impact your overall cost of living. Cities like London, Manchester, and Edinburgh tend to have higher living expenses than smaller towns or rural areas. Some key costs to consider:

Commuting Costs: If you’re moving further away from your place of work, you will need to consider fuel, rail or bus costs.
School Fees and Childcare: If you have children, school proximity and childcare costs can vary dramatically by region. Also, if you’re moving further away from your work or child’s current school/nursery, will this mean having to use breakfast or after school clubs, or paying for additional hours due to needing a later pick up/earlier drop off?
General Living Costs: Grocery prices, healthcare services, entertainment, and dining can differ across regions, so it’s essential to do some research before making your move.

5. Consider Your Long-Term Goals

When deciding whether you can afford to move house, you should also think about your long-term financial goals. Are you moving to a more expensive area where your monthly budget will be stretched? Will this impact your ability to save for retirement, build an emergency fund, or live your current lifestyle? Make sure that your move aligns with both your short-term and long-term financial aspirations.

6. Get Financial Advice

If you’re unsure about your budget or the financial implications of moving house, consider seeking advice from a mortgage broker or financial advisor. They can offer personalised guidance and help you navigate the complexities of the home buying process, ensuring you don’t overstretch your finances.

Mortgage advisors typically cost anything from £99 to £1000 for their services. When buying a new home with Strata, you can use our independent mortgage advisor panel for free. They’ll advise on affordability and also find the best possible mortgage deal for you to purchase your new home.

7. Use Free Tools to Help You Budget for a Move

There are many online tools to assist in calculating whether you can afford a move:

Mortgage Affordability Calculator: Strata’s free mortgage tool can give you an idea of how much you can borrow and what your monthly payments will be based on your income and expenses. You can also get pre-approved for a mortgage in just 60 seconds!
Stamp Duty Calculator: You can use Martin Lewis’s free Stamp Duty calculator to estimate how much tax you’ll need to pay when buying a new property.
Cost of Living Comparison Tool: This cost of living comparison tool allows you to compare how different cities vary when it comes to things like eating out, shopping for groceries, childcare and more allow you to compare the cost of living between different areas of the UK.