So you have embarked on the exciting venture of buying a property in the UK. UK is one of the most attractive destinations for property purchase worldwide. Now whether you’re looking for an investment property to rent out or a place to call home, our guide clarifies the process to purchase that dream home in London.
There are many types of property to buy in London; many who move to UK choose to buy rather than rent.
52.8% of families in the UK own their own home according to latest statistics; 28.2% own properties outright and 24.6% own with a mortgage. If you’re planning to stay in the UK long-term or you’re certain on a particular area, buying a UK house or apartment can be a fantastic solution, particularly considering the all-time low interest rates on mortgages in recent years.
CAN FOREIGNERS BUY IN UK?
The UK has no legal restrictions on expats and non-residents buying property and all foreigners and non-residents can also get a mortgage in the UK.
1. DETERMINE WHAT TYPE OF PROPERTY YOU WANT AND THE LOCATION
Deciphering the housing market is important to ensure you make the best decision when purchasing your dream property. The ultimate location you will select for your purchase is likely to be heavily influenced by your budget and personal requirements such as whether you are looking for a place to live or an investment property for rental yields and capital gains. Our UK specialists are experts on all things London and are able to discuss with you the various locations and options available throughout the city.
2. LAY THE GROUNDWORK
Once you decide to start looking for a property, gauge your finances to ascertain how much you can afford. Decide whether you will be purchasing with your own capital or if you will be taking a mortgage. Deciding how to finance your property purchase is an important step in the home-buying process. For most buyers, taking out a mortgage is a good option. However, before you start shopping for a loan, it’s important to take a close look at your finances. If you’re not sure how much you can afford, it’s a good idea to speak with one of our mortgage advisors. Once you have a clear picture of your budget, you can start looking for properties that fit your price range.
If you do decide upon a mortgage, as a non-UK resident you will typically need to pay a deposit between 25-40% of the purchase value.
In the UK, the process can take anywhere from one to three months from start to finish.
3. MAKE AN OFFER
Once you have your finances in place, you can put an offer on a UK property. You can do this verbally or in writing, but it’s important to be clear about the offer you’re making. If you’re putting an offer in writing, make sure to include the price you’re willing to pay, as well as any other conditions of the sale (such as the completion date). If you’re making a verbal offer, be prepared to answer any questions the seller may have about your offer.
Once your offer is negotiated and accepted, contracts are drawn up by the seller’s solicitors for the transfer of ownership. Ownership is not legally binding until contracts have been exchanged.
4. THE LEGALITIES
You now need to appoint a UK qualified solicitor/lawyer to carry out the legal paperwork of the purchase. Solicitor’s fees vary and start from £1000 plus VAT on-wards.
Your solicitor will be responsible for ensuring that all the legal paperwork is in order and will represent you in any negotiations with the other party. They will also be on hand to offer advice and support throughout the process, so you can be confident that you are getting the best possible deal. With their help, you can relax and enjoy the process.
Your solicitor will:
- Request a copy of your passport as well as proof of address (utility or phone bill addressed to you).
- Coordinate with the seller’s solicitor/lawyer to obtain legal paperwork and contracts.
- Carry out searches with local authorities, environmental department and drainage to ensure there are no concerns regarding the property which can affect the property’s value.
- Advise you of all legal fees, land registry/stamp duty fees and administration costs. Fees can vary.
Once your solicitor is satisfied with the details of the legal paperwork, the contracts will be presented to you to sign.
Once all checks are done, questions are answered and contracts are signed, you are required to transfer the deposit funds to your solicitor. Your solicitor will then exchange these with the sellers solicitor in return for the signed contracts. This is known as exchange of contracts.
5. CONGRATULATIONS YOU ARE NOW A PROUD NEW HOMEOWNER
A. If the property you have purchased is off-plan you will continue with the payment plan through to completion. Throughout the build period the developer will provide you will construction updates. You will receive a completion notice once the property in on course for completion to provide you with ample time to get your funds ready for the final payments.
B. If you have purchased an existing ready property, you will be given time after the exchange of contracts to get your funds ready in order to transfer them to the solicitor.
When you engage the services of a UK solicitor/lawyer, you can be confident that they will always act in your best interests and work to ensure that your transactions follow all compliance laws and regulations. This is because solicitors/lawyers in the UK are bound by a strict code of ethics which requires them to always act in their clients’ best interests and to uphold the highest standards of professional conduct. As a result, you can be sure that your UK solicitor/lawyer will always give you honest and accurate advice, and will work tirelessly to protect your rights and interests.