Brits spend £10bn a year on hidden costs of moving

The average household in Britain spends £23,800 on the ‘hidden’ costs of moving house over their lifetime, which equates to more than the average UK salary, according to a study by The Co-operative Bank.

As the main focus is often on the house price itself, these ‘hidden’ costs, which include all the extra expenses apart from the actual house price - such as solicitors fees, stamp duty, removal costs and estate agents fees - can often be often underestimated, despite the fact that collectively they add up to more than £10 billion for the total population.

Worryingly, despite all the hidden expenses involved with moving, only half of those questioned (56%) had a contingency fund in place to meet these costs. Other home movers get themselves deeper into debt by taking out further loans or borrowing on credit cards (15%), whilst some people are still relying on relatives for that extra help (5%).

John Barker, Head of Mortgages at The Co-operative Bank, comments “As house prices have continued to increase it is important for people to look at the bigger picture in terms of costs. Hidden costs that are not budgeted for can soon mount up and by having a contingency fund in place it will enable people to be fully prepared for any eventuality. ”

Although house prices are continuing to rise it seems that the majority of people today are not prepared to make sacrifices in order to afford the house that they want (57%). Where people are making sacrifices, over a quarter forgo holidays abroad (28%), whilst a fifth give up eating out (21%) or buying new clothes (18%). However one in ten people are so determined to afford the property of their dreams that they make much larger personal sacrifices, such as changing careers, or putting off starting a family.

To help home movers during this stressful time The Co-operative Bank is launching a new website tomorrow, which will provide help and advice for people who are looking to move. The new site co-operativebank.co.uk/movinghome contains the latest information and links on everything to do with moving house – from mortgage rates and legal advice to finding out how much your house is worth and where to find a local removal firm.

John Barker adds, “ As moving house is such a complex process, it pays for buyers and sellers to do their research beforehand and make themselves aware of the various sources and organisations available for advice. Becoming more informed about the options available should lead to healthier finances in the longer term.”