Climbing the Property Ladder

If you already have a foot on the property ladder and are considering a move, then the property buying costs you face are almost exactly the same as those of a first-time buyer, but with one major difference. If your current home has risen in value since you first purchased it, then the proceeds of the sale should provide you with a deposit for your next property. How large a deposit depends on how much you have left after the following costs have been taken into account:

• How much you sell your house for - your negotiations with your own buyer will affect this greatly - you may end up reducing the asking price by as much as 10%.
• Paying off what you owe on your current mortgage.
• Any fees that may be charged by your current lender for repaying your current mortgage early. However, these fees (if applicable), may be waived if you take out your next mortgage with the same lender.
• Estate agent fees - unless you choose to sell privately.
• All the legal fees involved in selling - unless you do the conveyancing yourself.
• Covering the cost involved in buying the next property, as well as removal expenses.

If all these additional costs add up so to such an amount that the sale proceeds are reduced to zero - and you have no additional cash - trading up is not an affordable option.

If you have made a healthy profit, you will still need to make sure that you have enough to put down a deposit of at least 5% on the new property, and of course you must also earn enough to get the size of mortgage you need.