Moving House Amidst The Inflation: Relocation Costs 2023
According to the Office for National Statistics, the UK’s inflation rate has steadily increased over the past few years. As of November 2022, the inflation rate was 10.67%, the highest in nearly a decade. This means that the cost of goods and services, including moving house, has also increased.
Are you planning on moving house in 2023? If so, you may be wondering how much it will cost you. In this article, we will look at the potential costs of moving house amidst the current inflationary environment in the UK. We will also provide tips on saving money on your move so that you can make the most of your budget. So, if you’re looking for helpful advice on moving house in 2023, keep reading!
The Cost of Living Crisis and Inflation about Rising House Prices
Before we begin discussing how much it will cost you to move house amid the current inflationary environment, it is essential to understand if people can afford such a move.
In recent years, the cost of living in the UK has been on the rise due to various factors, including the global financial crisis and inflation. As prices have increased, so too have house prices, making it more difficult for people to afford a home in certain areas. This is one of the primary reasons why moving house in 2023 may be more expensive than it was in the past.
Mortgage interest prices are also rising due to the continuously growing inflation rates, further complicating the issue. As a result, many people have to take out larger mortgages despite the rising interest rates to afford their desired property. This can lead to an even more significant financial burden when it comes time to move house.
This begs the question, “Is it actually worth moving house in 2023 if the inflation and rising prices remain?”
The answer depends on your circumstances. If you are planning to move for work or family reasons, it may still be worth relocating despite rising inflation and the steady rise in the cost of goods. However, if you are hoping to take advantage of a better property market, it may be best to wait until prices begin to cool down before moving.
If you have yet to decide, read below, where we will discuss some of the costs associated with moving house in 2023 and offer tips on how to save money during this process.
Average UK House Price
The average house price in the UK is currently around £296,000, which is about £36,000 more expensive than the housing market average in August 2021.
As with everything else, this house price inflation will likely still be felt in 2023. However, as of writing this article in December 2022, there have been forecasts of the housing market finally cooling off in 2023, but the purchase price of houses is still likely to remain higher than they were pre-pandemic. That means it is still essential to consider the costs of moving house in 2023 before committing to a move. Average house prices may vary depending on the location and property type, so research your area before committing.
The Average Cost Of Moving House
Given the current inflation rate, moving house costs in 2023 is likely higher than in previous years. It is estimated that a typical move, excluding your rent or house price, will typically cost between £8,000 and £11,500.
This amount includes housing fees, taxes, packing, storage, insurance, removals, and other related costs. Of course, this average figure can vary depending on the size of your move and the services you require. Below is a full breakdown of everything you may have to pay for when moving house.
An Itemised List Of Items You Will Spend On While Moving House
Here are the items you will be expected to pay for when moving house in 2023, as well as estimated costs.
A professional valuation will be necessary to obtain a mortgage if you are purchasing a home. Most mortgage providers offer this as a free service, but some companies will require you to hire an independent valuer. Doing so makes getting a more accurate valuation possible but it will come with an additional cost. Expect to pay somewhere around £200 to £500 for this service. These prices will depend on the property’s complexity and the area’s size.
A home survey is an important part of the home-buying process. This allows you to understand the property’s condition before committing to it. Depending on the type of survey (homebuyer report, standard, or full structural) you get, these fees can range from £250 – £1,000. Such fees are typically the responsibility of the buyer.
Estate Agent Fees
If you are buying or selling a property, estate agents will be required to help you complete the transaction. Depending on your agent and agreement, commission fees can range from 1-3% of the sale price. This money is typically taken out of proceeds from the sale of the house.
As of April 2020, the Stamp Duty Land Tax (SDLT) has been temporarily reduced on homes up to £500,000. This means you are only expected to pay a tax rate between 0-5% depending on your home’s price tag. Those buying second properties or homes costing more than £500,000 will be required to pay higher tax rates.
The cost of the removal company you choose will depend on your individual needs and the distance you are traveling. Are you planning a small house move or a larger relocation? Expect to pay between £500 – £2,200 for a whole house move. You may be able to find lower prices if you choose to do the packing and loading yourself. Man and van companies are also reliable, as they can offer cheaper fees than traditional removals services. Just remember to get multiple quotes from different companies before signing a contract.
If you need short-term or long-term storage, this will come with an additional cost. Prices vary depending on the size of the unit and length for hire. Expect to pay between £10 to £25 per square foot for ongoing storage costs.
Conveyancing fees are used for both property purchases and sales. They are charged to cover the processing of paperwork, legal advice, and any other related costs. Fees can range from £1,000 to upwards of £2,500, depending on the complexity of your transaction.
Capital Gains Taxes
If you sell a house before April 2021, you may be required to pay Capital Gains Tax (CGT) on any profits. Depending on your income level, CGT is currently charged at 18% or 28%. Such taxes are only applicable if you profit from the sale of your home.
You will also need to consider insurance costs when moving house. Buildings and contents insurance fees will depend on the size of the property and any additional services you choose. Such policies can cost anywhere between £50 – £200, depending on the type of cover. \
Suppose you are planning on moving into a rented property. In that case, you will also be required to pay several types of housing deposits, including the security deposit, holding deposit, and rent in advance. Security deposits can range from one to five weeks worth of rent, while holding deposits are typically one week’s rent. Rent in advance is usually one month’s rent.
Additional costs may include repairs, renovations, new furniture, or appliances. These are usually the buyer’s responsibility and can vary significantly in price. Make sure to plan for these costs, as it is not always possible to predict them with certainty.
These additional costs should be taken into consideration when moving house amidst inflation. It is important to factor in all expenses before signing contracts or making payments. With careful budgeting and planning, you can ensure your expenses are covered when moving house during inflationary times.
How To Save More Money When Moving Amid Rising Costs
Frome minimising household budgets to searching for the best deals, there are several ways to move affordably despite the economic inflation.
Hire Movers For The Relocation
While it may seem quicker and cheaper to do the packing and to move yourself, it is recommended to hire someone else to do the job for you. A man and van or a removals company will be able to do the work for you quickly and safely.
Moreover, because they are trained and experienced, they will also be able to ensure that your items are securely packed and transported. This, in turn, means your belongings are less likely to be damaged during the move, so you won’t have to worry about spending extra money on replacements.
Aside from the financial implications, you will find that hiring movers will also help you minimise the stress and struggles you would experience on moving day.
Pack Light & Minimise Your Move
If you’re trying to save money, it is best to pack light and only take the items you need. This will help reduce moving costs, as fewer items means fewer boxes to transport. It also helps minimize clutter in your new home, so you won’t have to worry about dealing with excess items when you move in.
Compare Storage Estimates
If you need storage for your goods, compare estimates from different companies to find the best rate. Many companies offer discounts or special offers on long-term contracts. Be sure to ask about these before signing up.
DIY Where You Can
Doing some of the moving yourself, such as packing and loading/unloading boxes, can save you money. This is especially true if you are working with a limited budget.
Negotiate With Your Landlord
If you’re renting a new property, don’t be afraid to negotiate your rental costs. Many landlords are willing to lower the price if you can prove why it is beneficial for them. Make sure to research the local market and come prepared with evidence of comparable properties in the area.
Sell Unwanted Items
Selling unwanted items can help to offset some of the costs associated with moving house. Have a yard sale or list your items online and use the profits to finance your relocation.
Search For Discounts And Deals
Most companies offer discounts and special offers on certain products or services. Make sure to search for discounts and ask about any promotions before making any purchases.
Find Areas In Your Household Budget Where You Can Allocate Some Funds From
If you’re on a tight budget, look for areas where you can allocate some funds from towards your moving expenses. You may be able to reduce costs by cutting down on unnecessary spending or making some small adjustments to your lifestyle.
Minimise Eating Out During The Process
Moving house can be very exhausting, which is why many opt to go out for meals instead of cooking at home. However, this can add up quickly. Make sure to minimise dining out and cook more meals from scratch during the process.
Moving house amidst the inflation does not have to be costly or stressful. With careful planning and budgeting, you can find ways to save money and reduce the expenses associated with your move. Take the time to research all costs involved in relocating and use the tips above to help you save more money.