For most people saving the 10% of purchase price required for home purchase can be a challenge. If you are a first time buyer purchasing a new build home then the Help to Buy Scheme can certainly help towards deposit offering 10% of the purchase price capped at €30,000.
It is important however to know that there will be other costs along the way which you also need to account for.
Our rule of thumb is that you will need another 2% of the purchase price to transact on the purchase of your home. So if your home buying budget is €400,000 then you will need €40,000 deposit towards purchase and another approximate €8,000 to cover cost related to completing out on your home purchase.
The main costs in the mortgage and home buying process are as follows –
Mortgages – Reports and Associated Fees:-
- Valuation Report
Once you are sale agreed on a home your next step with regard to your mortgage will be to progress to valuation.
What is a mortgage valuation? A valuation is a visual inspection and report prepared to confirm the market value of the property you intend purchasing and to also set out the nature of the property, house, apartment etc.
The cost of a valuation is c. €200 and each bank will have a panel of approval valuers one of which would be appointed to complete your valuation.
- Structural Survey:
Structural Surveys are advisable when you are purchasing a second hand home. A survey should be carried out by a qualified professional such as a surveyor, an engineer or architect.
What is a structural survey? A survey involves inspecting the structure of the property to identify if the property is structurally sound.
A standard structural home survey can range from €300 to €800, depending on property size and complexity.
If a survey is sent to a bank with ‘essential repairs’ noted then the bank will always want to see how you can afford to complete these essential repairs and may hold back part of the mortgage until the repairs are complete.
Specialist Surveys may also be required if for example there is a major problem with damp or evidence of subsidence or asbestos.
To Note: While its advisable to carry out a structural survey a bank will not require a copy of the structural survey unless the property is over 100 years or the valuation report calls out that a survey would be recommended for example if there was extensive cracking etc.
- New Build – Snag Inspections
If you are purchasing a new build home you may choose to engage a firm to carry out a snag. A snag list is where you view the property when it is complete to ensure that you are happy that all is in order with for example the heating system or electrics etc.
Snag inspection are approximately €300.
- Broker Fees –
At doddl, we do not charge a fee for our services – we are a FREE service. We get paid by the mortgage lender you choose to take your mortgage with. Its really important to note that the fee we receive is the same regardless of the lender or product you select ensuring no bias on our part. The bank pay us as a distribution channel instead of having to have staff and operating costs to offer mortgage. At doddl we are your point of contact from enquiry to keys, helping you every step of the way.
Legal Fees and Taxes:-
- Legal Fees:
The legal process to purchase a home is called conveyancing. Your solicitor will be a huge part of your home buying journey so choose wisely! At doddl, we work with a panel solicitor called Beam – www.letsbeam.ie who offer a flat professional fee to our clients of €2,200 + VAT.
As part of the conveyancing process there will also be costs relating to registration of the property in your name and legal searches that are required.
Overall, we would suggest that you budget €3,500 for legal fees.
- Stamp Duty:
Stamp duty is a tax payable on the purchase of a property in Ireland.
The standard rate is 1% of the value of a property up to €1m and 2% on the portal over €1m.
Stamp duty on new builds is slightly lower as the stamp duty is levied on the cost of the property excluding VAT.
Given the price of property stamp duty can be a large cost that you need to budget e.g. purchase price €400,000, stamp duty is €4,000.
- Local Property Tax (LPT):
Local Property Tax is an annual charge based on the market value of your home. The tax rates can depend on value banks set by Revenue.
You can choose to pay on an annual basis or in instalments.
- Service Charges:
Some homes that are apartments, duplex or in gated communities have a service charge levied. This is to cover costs of communal areas or insurance.
Service Charges on apartments tend to be based on number of bedrooms and the development itself. An average of €1,500 per annum should be budgeted for.
Ongoing monthly costs to budget for –
- Your mortgage repayment
- Life Cover & Protection Insurances
- Home Insurance and Contents
All of the above our team at doddl can help you with – our aim is always to secure the lowest mortgage rate and the best cover at least cost on insurance products.
To understand your home buying budget, tips for saving or just general advise be sure to contact our team of advisors – Start Here!
