During the planning stage of buying a property, I set aside a small contingency budget to cover any unforeseen and miscalculated circumstances. Something was ALWAYS bound to pop up.
So far I think i’ve been fortunate, I haven’t had to dig too deeply into my contingency pocket. I’ve been lucky for now, but the project is far from over, so I don’t want to count all my blessings just yet.
However, I just want to highlight a few of the extra costs that did crop up. Before I start, I just want to say that the expenses and list is going to seem lousy in comparison to some heart-stopping situations I’ve read about. Nonetheless, I just want to get across that unforeseen expenses nearly always occur, so it’s imperative to have a contingency, even if it’s only a small one.
Extra costs I didn’t anticipate:
- £20.00 for a new driving license that my Conveyancing Solicitor lost (even though they deny it)
- £4.50 for Special Delivery post to my Conveyancing Solicitor
- £25.00 fee for transferring money electronically. Halifax changed £25.00 for transferring my deposit into my Solicitor’s account. I thought that was ridiculous. Anyways, I could have got a banker’s draft for free, but it would have held up the exchange in contracts by the time the draft arrived to my solicitors and cleared.
Like I said, not much at all for now. It’s pathetic, I know. Not even worth mentioning. However, I’m a firm believer that every penny counts.
Common areas where unforeseen costs occur
Here’s a list of common areas where a lot of buyers end up spending their contingency. Perhaps if you avoid these areas, the contingency can be minimized…
- Solicitor– Some Conveyance Solicitors stipulate that they charge extra if a deal isn’t completed with in a certain time scale i.e. they charge extra for delays. A lot of people aren’t aware of this, and since delays are extremely common, they’re often shocked when they see the added legal fees.
- Repairs– while viewing a property it’s not always possible to check every nook and cranny to see if everything is in working order. So once you’ve moved into your new home and start using all the appliances and utilities, it slowly becomes apparent what needs repairing. That’s why it’s always important to thoroughly check a property before purchasing it, especially the electrics, heating, plumbing and the roof. Being thorough during a viewing can often save a lot of stress and cold cash. Here’s a more elaborate list of things to check when viewing a house. Spending money on unanticipated repairs is probably one of the biggest area where the contingency budget gets spent on.
- Decoration– much like with repairs, it’s not always possible to see how badly decorated a property truly is during the viewing, but when the property is empty and it comes to moving day, everything becomes clear.
- Temporary accommodation– when there’s multiple parties involved in a chain, some parties complete sooner than others. That’s when some people may need temporary accommodation, in the case where they have sold their property, but their vendors is still waiting on those above them in the chain.