How to buy a property
Find your property
Work out your budget, based on how much you can raise as a deposit, your income and other debts or outgoings.
Don't forget the various costs of purchase, such as house surveys, mortgage arrangement fees, stamp duty, legal costs and extras for furnishing, decorating and removals. Speak to a mortgage lender or specialist financial adviser to get an idea of how much you can afford.
Decide on the key features you need (the number of bedrooms for example or if a big garden or garage are a priority), the amount of work you're prepared to consider doing on a property and the area you want to live in.
It's useful to prioritise, but remember, the more 'must haves' there are on your list, the fewer properties you'll find that meet your requirements. Be open to ideas that don't precisely meet your brief – you may be surprised.
Looking online on websites like primelocation.com or upmystreet.com, will give you an idea of what has sold recently in the areas you're interested in, and therefore indicate how realistic your expectations are.
Starting your search online will also help identify the estate agents that are most active in the area you want to move to. It's then a good idea to register with two or three agents in person and discuss your requirements in more detail.
When you see something you like, you can arrange a viewing through the estate agent. Try and see a good range of properties to get a clear idea of the house styles and options in the area – it may help you refine your list of 'must haves'.
Where possible, try and view in daylight so you can see any less visible problems.
Ask yourself if the property meets your requirements in terms of rooms, space, storage and outside areas? Has it been well maintained?
Don't neglect to ask the seller plenty of questions too and be thorough: why is the seller leaving, what is and isn't included in the sale, are there any planning restrictions on future alteration work and when was the central heating last serviced.
If after all this you think the property could work for you, arrange a second viewing. Take other members of your family if they didn't see it first time, or a sensible friend if you're buying alone so you can get a balanced second opinion.
Making an offer
It's crunch time. Gather as much information as you can about the local market and the seller's own situation before you make an offer. For instance, has the asking price already been lowered? Does the seller need to move quickly?
Consider the strengths of your own position, as it could influence the seller to choose your offer over another bidder's. For instance, you'll be able to move swiftly if you are chain-free, or a cash buyer, or have already exchanged on your existing property.
The level of the offer you make will depend on the state of the market, the length of time the property has been available, whether there are other interested parties and so on.
You may choose to start well below the asking price and raise it gradually by negotiation, but if the market is buoyant that probably won't be an option.
Make your offer via the estate agent, who will pass it on to the seller. Remember to highlight your position if you think it could be beneficial. Don't offer more than you can afford, even if it's your dream property.
Once your offer is accepted subject to contract, you should get a survey done to highlight any problems with the property: these may act as a basis for further negotiation on the price if they will be expensive to sort out.
A basic valuation is only for the benefit of the mortgage lender so you will need to either get a homebuyers survey, which costs around the £500 mark, or a more detailed full structural survey, which is closer to £700–800.
This isn't necessary for a lot of properties though and a homebuyer's survey should be fine for flats and recently built homes.
Older buildings and those in poorer condition are likely to need a full survey. Choose a surveyor who knows the locality and local housing stock if possible.
If you're buying or selling a home, you will probably need a property or conveyancing solicitor to deal with the legalities: Be aware that the system is different in Scotland from that in England and Wales.
From agreeing a completion date and drawing up the contract to holding your deposit and passing it on once contracts are exchanged, organising local authority searches and registering your ownership with the Land Registry, costs for this are in the £600-700 bracket.
Essentially the solicitor acts as go-between for you and the seller's solicitor and generally ensures that all the paperwork is in order.
Just how long this process takes will vary from case to case. If your chain is short – for example your sellers aren't looking to buy another property, and the paperwork straightforward you could proceed in a matter of weeks.
However if numerous properties are involved or you encounter problems along your way it could be several months before you are able to move into your new home.
You can speed the process along by chasing your solicitor and completing your side of the paperwork as quickly as possible.
A catch-all phrase that can range from assessing the price of a property or vehicle before offering it for sale or the net worth of assets in an investment portfolio to the prices of shares on a stock exchange.
A hugely unpopular tax paid on property and share purchases. Stamp duty on property is levied at 1% for purchases over £125,000 (£250,000 for first-time buyers) which then moves up at a tiered rate. For property between £125k and £250k you pay 1%, then 3% from £250k up to £500k and then 4% from £500k to £1m and then 5% for properties over £1m. But unlike income tax, which is “tiered” and different rates kick in at different levels, stamp duty is a “slab” tax where you pay the rate on the whole purchase price of the property. On shares, stamp duty is charged at a flat rate of 0.5% on all share purchases. Figures correct as of May 2011.
The branch of law concerned with the preparation of documents for the buying and selling of property (or remortgaging), always handled by a qualified solicitor. The conveyancing process covers many of the legal aspects of the sale/purchase/remortgage such as land registry, local authority searches, freehold and leasehold status, title deeds and much more.
A property chain is a line of buyers and sellers (the “links”) who are all simultaneously involved in linked property transactions. When one transaction falls through – for instance, someone can’t get a mortgage or simply withdraws their property from sale, the entire chain breaks and all the transactions are held up or even fail entirely.
Everything you own: all your assets (property, cars, investments, savings, insurance payouts, artwork, furniture etc) minus any liabilities (debts, current bills, payments still owed on assets like cars and houses, credit card balances and other outstanding loans). When you’re alive this is called your wealth; when you’re dead, it becomes your estate.