The cost of buying

Remember to include the various purchase costs when budgeting for your property purchase.

You should allow 5-6% of the purchase price to cover all of the purchase costs. This includes a stamp duty of 1.5% of the property’s declared value, the estate agent’s commission, which is 3%, and various small official fees and charges. Compulsory earthquake insurance is £40-£100 per year. Finally, there are legal fees, which will depend on the property and its location, but should £500-£2,000.

The declared value of a property on the title deeds is often much lower than the amount you are paying. Although illegal, under-reporting is a widespread practice to reduce stamp duty and property tax liability. The government will eventually crack down and there are potentially serious tax implications when you come to re-sell the property the future. So whenever possible it is best to have the full value of the property declared on the title deeds.

If you are purchasing in another currency, such as euros, remember to use the services of a recognised foreign exchange dealer.