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From Money Magazine

Paul Clitheroe explores the pitfalls, hassles and all you need to keep in mind when doing a make-over or moving house.

Generally speaking, you’ll start thinking about whether to move or renovate when you feel you’ve outgrown the capabilities of your existing home. It could be the kids are growing and are demanding their own room, or you want some space to do your own thing.

In brief

By staying put, you’ll be spared some major (and unavoidable) expenses including estate agent selling fees, stamp duty, legal fees, removal costs, building and pest inspections, searches and surveys.
Don’t forget that in nearly all cases, if you borrow more than 80%, you’ll have to pay mortgage insurance too. As a rule of thumb, the larger the loan and the smaller the deposit, the heftier the mortgage insurance slug will be.
The other big impost when moving is stamp duty tax. This is paid on the purchase price of the property. You will also pay it on your mortgage. To calculate how much stamp duty you’ll pay on your property purchase,
click here.
If you renovate, you will be up for some fixed costs as well as any number of variable costs depending on how grandiose the renovations are. The unavoidable costs you’ll face are: council fees and the design plans.
Variable costs can include builder’s fees and materials, architect’s fees, storage fees and bank fees for extending the mortgage.

What Paul Clitheroe says

Finally, as a word of warning, if you decide on renovating, it’s vital you try and avoid the trap of “over-capitalising”. You’ll over-capitalise if the renovation costs more than the market value it will add to your home.

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