Moving home should feel exciting. But for many homeowners, today’s mortgage market is making the process feel far more financially complicated than expected.

Higher household bills, affordability pressures and changing mortgage rates mean even well-planned moves can quickly become stressful. While homeowners with equity are often in a stronger position than first-time buyers, that does not automatically make the next move straightforward.

The purchase price is only part of the picture. Legal fees, surveys, removals, stamp duty and potential work needed on the new property can rapidly change the overall cost of moving.

Commenting, property expert Sam Fox, founder of UKMC, said:

“A lot of people start with the house they want and then try to make their budget fit afterwards. In this market, that is the wrong way round.

“Before you fall in love with the next property, you need to understand your mortgage position, your equity, your likely costs and what the new monthly budget realistically looks like.

“It’s not necessarily about making a compromise, but it’s important to have an honest look at the numbers and to try and not let emotion take over.”

Here, Sam outlines the key areas to pay attention to. 

His advice is also available via this YouTube video.

Check whether your mortgage can move with you

“If you are midway through a fixed-rate deal, one of the first things to check is whether your mortgage is portable.

“Porting means you may be able to transfer your existing mortgage product onto the new property, subject to affordability checks, valuation and lender approval.

“If you need to borrow more, that additional borrowing may sit on a separate product with a different rate and end date. That is where things can become complicated.

“If your current fixed rate is higher than what is available now, paying an early repayment charge and starting again could actually work in your favour. If your existing rate is lower, porting could protect you from moving the entire loan onto a more expensive deal. Either way the most important thing is to ensure you aim to get proper advice.”

Understand your equity position properly

“Equity is simply the difference between your property value and the remaining mortgage balance.

“If your home is worth £250,000 and you owe £150,000, you have £100,000 equity. When the property sells, that equity will usually form the deposit for your next purchase.

“That can put homeowners in a strong position, particularly if the property has increased in value over time or improvements have been made.

“But equity alone does not guarantee the next mortgage works financially. Affordability still matters, especially if you are moving to a more expensive property.

“If you are downsizing, you also need to check whether paying off part of the mortgage early could trigger repayment charges.”

Budget for the full cost of moving

“It’s important to try and take a 360 approach when moving home, so you can cover all the bases. 

“Getting approved for a mortgage is obviously a massive box ticked, but it’s really important to also look at the wider financial impact that comes with moving. 

“A detailed-budget can help you live more comfortably with the costs that moving home can bring. 

“If you are moving to a larger property, it’s especially important to factor in larger bills, higher council tax, any additional furnishing and costs and maintenance fees. 

“Equally, if you are downsizing, aim to set out where you could make savings.”

Keep emotion out of the first viewing

“The first viewing of a property that you’ve fallen in love with can be really emotional. You’ll have seen the pictures online, but then seeing it for yourself makes it feel all the more real. 

“You’ll start to picture the furniture, the garden and the fresh start. Enjoy that moment, but always aim to have a second viewing too before you put an offer in. 

“The second viewing is usually where a bit more logic will kick in as the emotional pull won’t be as strong. That’s the viewing were you can do the less exciting, but equally important things, like checking the boiler, electrics, roof, windows, damp, storage and overall condition.

“Ask how long the property has been on the market and why the seller is moving. Those answers often tell you more than the brochure does.”

Speak to an adviser before making an offer

Fox says many buyers leave mortgage conversations too late in the process.

“Once you have made an offer, emotions and pressure increase quickly.

“It is far better to understand your borrowing position, credit profile, portability options and any repayment charges before you join a chain or start paying fees.

“The earlier you understand the numbers, the calmer and more confident the whole process becomes.”

 

Disclaimer

UK Mortgage Centre Limited is an Appointed Representative of Refresh Mortgage Network Limited. Refresh Mortgage Network Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register under firm number 1019794.

UK Mortgage Centre is an authorised credit broker and not a lender. The company works with an unrestricted number of lenders to find a potentially suitable arrangement for customers’ consideration.

As a mortgage is secured against your home, it could be repossessed if you do not keep up mortgage repayments.

The Financial Conduct Authority does not regulate some forms of buy-to-let mortgages.

The Financial Conduct Authority does not regulate will writing, taxation or trust advice.

Customers may be charged a fee for advice. A typical fee is £595, payable on receipt of a mortgage offer. Advisors will discuss this during the initial consultation.