Managing my money
Managing my money

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Managing my money

6.1.4 How much does it cost?

This quiz tests your ability to calculate the costs of buying a home.

Activity 1

An offer of £150,000 on a property has been accepted. The following costs apply:

Legal fees£500
Valuation survey£250
Structural survey£750
Arrangement fee to the mortgage lender£250
Removal costs£1000
Stamp Duty Land Tax is payable at 2% on the purchase price above £125,000

How much does it cost in total to buy and move into this property?

a. 

£150,000


b. 

£153,250


c. 

£152,750


d. 

£150,500


The correct answer is b.

b. 

Well done. The total costs are as follows:

Cost of property £150,000

Stamp Duty Land Tax (£25,000 x 2%) = £500

The other costs are £500 + £250 + £750 + £250 + £1000 = £2750

The total cost of buying the property is therefore £150,000 + £500 + £2750 = £153,250


An offer of £150,000 on a property has been accepted. The following costs apply:

Legal fees£500
Valuation survey£250
Structural survey£750
Arrangement fee to the mortgage lender£250
Removal costs£1000
Stamp Duty Land tax is payable at 2% on the purchase price above £125,000

What are the extra costs (excluding the property price) as a percentage of the property purchase price?

a. 

2.17%


b. 

2.76%


c. 

0.28%


d. 

3%


The correct answer is a.

a. 

Well done!

The extra costs are (£3,250 /£150,000) × 100 = 2.17% on top of the cost of the property.


MMM_1

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