It’s often said that buying a house is one of life’s most stressful ventures. To make things that little bit easier, we’ve put together a step-by-step guide which covers the whole process of buying a house in the UK. Our guide outlines the key legal and financial considerations for a UK property purchase in a series of simple steps.
Step one: Find the property
While the first step that you will take during your property search will usually be to look up properties online, if possible it’s always a really good idea to spend some time visiting the area you wish to purchase.
Visit the local estate agencies, assess what properties are available and get a feel for the neighbourhood where you wish to buy a house. A good estate agent is an incredibly important part of your property purchase, so take the time to find out about the different agents in your desired area and see how helpful they are.
Step two: Visit the property
We recommend visiting any prospective properties several times to make sure that it’s everything you need. We would also recommend exploring the area and speaking to local people to find out what the area is really like (you can always rely on the British to point out flaws about their home town!).
Renting versus buying a house
Overseas buyers who are looking to emigrate or buy a holiday home often try before they buy in their country and area of choice by renting beforehand. Many agents offer both short and long term rentals as well as property purchases. Speak to some agents and look around to see what’s on offer that suits your needs.
Step three: Ensure finances are in place
When you find that right property for you, it’s time to make an offer! But first, you will need to make sure all your finances are in order – especially if you are buying with a mortgage. It is important that you factor in the additional costs such as legal fees and agency commission. Legal fees for a property purchase in the UK will typically cost somewhere in the region of £850-£1,500, including VAT at 20 per cent.
Step four: Legal advice
You should always use a qualified solicitor when buying a house in the UK. In fact, many mortgage providers require both parties to be professionally represented. Meanwhile, the estate agent will normally take somewhere between 1-3 per cent of the cost of the property. Don’t forget currency costs too.
Your real estate agent is incredibly important in a successful property-purchase process. Find out more about choosing the right real estate agent and how to make the most of your property search in the UK.
Step five: Make an offer
You will need to ensure you find the right independent solicitor and, with their advice, make an offer on your dream home. Your estate agent will make this offer to the seller for you. It is worth noting that even if the offer is accepted, the house is still not legally yours. You and the seller are not legally bound to complete the property purchase until you have reached the exchange of contracts. Until this happens, the seller is free to accept a higher offer from another party, should one materialise. This is called “gazumping” and is common practice in the UK, unfortunately.
Step six: Organise a survey
While your solicitors and agents work with the seller’s representatives to draw up the contract, it is worth organising an independent builder’s survey of your potential property. This will alert you to any problems with the home, such as structural damage or damp. Remember, the property purchase is still not legally binding at this stage, so if any problems are found, it’s not too late to negotiate on price, or even pull out completely. The cost of a survey will vary from between £300 for a standard builder’s inspection to around £1,000 for a full structural survey. It is important to factor in these costs as part of your budget.
Step seven: Negotiate a completion date
Once all finances are in place and the buyer has made all their relevant checks, the solicitors will discuss the completion dates required by their clients. Once both parties are ready to proceed, there will then be an exchange of solicitors’ contacts. This is a binding contract and once signed, withdrawing will cost the buyer their deposit and could leave them open to legal action. Non-Brits buying a house will usually be asked to pay 10 percent of the purchase price at exchange of contracts.
Step eight: Completion date
On the date of completion, the solicitor will arrange to settle the remaining sum for the property and then register the title at the Land Registry and send the buyer evidence of registration. Thereafter, the property belongs to the new owner and they can take possession of the keys. This entire process commonly takes between two to three months and can be longer. This will come as a shock to some overseas buyers, who may be used to much quicker processes for a property purchase in their home country.