The UK Property Buyer’s Guide
BEFORE
1. UNDERSTAND YOUR PURPOSE
Before choosing a property, you need to consider the purpose of buying the property in the UK. See the bigger picture! Are you buying the property for self-occupation or investment? Are you going to move in a few years? Freehold house or leasehold apartment? And don’t forget, a location is very important.
2. KNOW YOUR BUDGET
The first thing you need to consider is your budget, not only to cover the cost of the property but as well legal fees, Stump Duty and the cost to own the property – maintenance, utilities, service charge and ground rent.
The second thing you need to consider is a time scale of payments regarding the property purchase and to understand when and how much you will need to pay.
Check below an examples of stump duty to find out, how much tax you will need to pay. The stamp duty calculations should be used as a guide only. Please consult HMRC for the latest tax information.
PROCESS
3. FINANCING & MORTGAGE
BUYING IN CASH
To be able to buy a property in the UK using cash you need to be able to provide a proof of funds in a form of bank statements showing funds on your account and proving that the funds have come to the account legally – AML check.
BUYING WITH MORTGAGE
If you need a mortgage you should start the whole process in an advance. We work with professionals who have proven they are experts in this field. Please contact us to help you to find a mortgage advisor who can save you a lot of time and maximise your success. The mortgage approval and amount depends on your personal financial situation and qualifications. According to the needs of different banks, the materials you need to prepare will be different, such as personal tax certification/returns, payslips and so on.
It is important to have pre-approved mortgage, MORTGAGE IN PRINCIPLES, to understand how much money, which bank can lend you and what are the conditions.
4. CONSULTATION
After initially clarifying what is your purpose and budget, we will recommend the most suitable properties according your needs and provide you with our professional advise and market expertise.
5. SELECT PROPERTIES
Once you consider all your needs, musts, wishes and budget, we will help you to choose properties which match your requirements, we will prepare you handbooks including information on recommended properties, texture (freehold/leasehold), properties rights, estimated Stump Duty, council tax, service charge, ground rent, surrounding life, facilities, schools, transportation and estimated rent return to assist you to make qualified decisions.
6. VIEWINGS
VIRTUAL VIEWINGS
We will provide you with property walk-through tours of most of the selected properties, so you can explore the properties from comfort of your sofa 24/7 anywhere in the World. As well, upon request we can organise live video tours of the properties via WhatsApp, FaceTime or Facebook Messenger.
ON-SITE VIEWINGS
If you are in the UK and you want to visit selected properties we will arrange viewings for you to ensure that you will be able to view the properties smoothly, without waiting and be guided by all important information.
If you are not in the UK, we can help you to book an accommodation, arrange a program for you and to help you to explore area of selected properties.
7. NEGOTIATION & OFFER
To be able to give a qualified offer you need to have your financing in place and able to prove your ability to purchase the property in a form of a proof of funds (bank statement) or a mortgage in principles.
Some real estate prices can be negotiated with property sellers or developers. We have an experience with negotiation and we will help you to negotiate on your behalf the purchase price or even what can be included in the purchase price, like parking space/s, furniture or a certain package of the property finish.
SECRET TIP
If you are purchasing a property from a developer, ensure you agree the number of parking spaces purchased/included with property on this stage and this is included in the reservation form/contract. If you do not do it on this stage, you will need to wait till all properties within the development will be sold and hope there will be an additional spare parking space for you. There is a huge chance there will be no extra parking space or at the end, you will have to pay much more if there is.
8. RESERVATION & DEPOSIT
When purchasing a new-build property from developer you need to make a property reservation. At the time of booking, you need to pay a deposit (£2,500 – £10,000 – demanding on the development and property price) to the developer, which will be automatically deducted from the property purchase price.
9. INSTRUCT SOLICITOR
In the UK, the entire real estate transaction is conducted by the buyer’s and seller’s solicitors, including buyer’s AML check, ID check, surveys, property searches, contract expertise and advise, approval of contracts, contract exchange, fund transfers, completion and registration to the Land Registry.
To choose an outstanding solicitors is crutual to ensure that the whole process is quick and smooth. Let us to help you.
10. CONTRACT EXCHANGE
BUYING EXISTING PROPERTY
A time line of purchasing an existing property is about 1 – 2 months in case there are no complications. However, you can instruct and pay your solicitor to insure the property searches and this process can be quicker.
After you and your solicitor are satisfied with the property searches, conditions and contract, your solicitor will exchange the contracts with the seller’s solicitor, you may need to pay 10% down payment and the completion date will be agreed. This is the date when you or you & your mortgage provider will need to pay the rest of the purchase price and the seller will handover you the property, this is usually within 21 days of the exchange date.
However, if you are purchasing the property in cash, you, your and seller’s solicitors are ready, the exchange date and the completion date can be the same. This can be convenient mostly for international investors who will arrive in the UK on the exchange date and they want to complete at the same day to be able to use the property straight away.
BUYING OFF-PLAN PROPERTY
When you are purchasing a property which will be completed in future, the process is different. At the time of the booking you still will need to pay the reservation fee. Depending on the project and project’s time line, you will need to exchange the contracts, usually within 21+ days and pay a certain down payment (10%) and there may be a different payment schedule till there is completion.
11. COMPLETION
After transferring the rest of your cash funds or your cash & your mortgage from the mortgage provider to your solicitor’s clients account, your solicitor will transfer the funds to the seller’s solicitor. Once the seller’s solicitor confirms that the funds arrive to his clients account, he will release you, your solicit or agent the keys of the property and you become a home owner.
AFTER
12. YOUR FIRST DUTIES AS HOMEOWNER
With purchasing the property are coming huge responsibilities:
COUNCIL TAX & PAYMENTS
We will help you to register and set up council tax, service charge, ground rent utility suppliers accounts like water, electricity, gas, heat, cooling, TV licence, broadband and other which are provided to your new property.
SNAGGING PERIOD
If you will purchase a new-build property from a developer, there is a short period, called SNAGGING PERIOD, it can be as short as a few days or even 30 days from completion date – this must be confirmed during the completion. During this period we will help you to point out all snagging issues which needs to be fixed by the developer.
REGISTER APPLIANCES WARRANTY
If you will purchase a new-build property, we will help you to register warranty for all appliances included with the property. This is very important, for some appliances the warranty period may be even 5 years during which you are eligible for a free servicing, if the appliance breaks. However, if you forget to register your appliance for warranty with the manufacturer, you may be charge for any servicing.
SAVE THE DATES
Save the date for regular services – gas safety inspection, boiler, heating service and other.
13. AFTER SERVICE
As part of our professional service we will introduce you our trusted contractors in your property area, as well we offer other after purchase services:
EMPTY PROPERTY MANAGEMENT
We offer empty property management for homeowners who use their UK property only once a time and they want to ensure their property is looked after and if there is anything, we will take care of it – this includes regular inspections, managing all service/suppliers’ payments and property maintenance.
LETTINGS
If you purchase the property as an investment we offer letting services:
LET ONLY – we find a tenant and you are collecting the rent and managing the property
RENT COLLECTION – we find a tenant, collecting the rent and you are managing the property
FULLY MANAGED – we find a tenant, collecting the rent and fully managing your property
