For Scots buying ‘down south’, or even for English ‘returners’, it can seem a daunting process but with a little bit of knowledge or assistance, it can be the positive experience that buying a home should always be.
- When buying a home in England & Wales you are usually buying either a freehold house or a leasehold flat
In Scotland, both are usually ‘heritable’ and owned outright, and whilst this is the same for freehold houses in England & Wales, flats are usually only leasehold. If they are freehold flats, they are best avoided.
- When looking for a property, it’s good to do an initial internet search for an estate agent in the area
Look on their websites to see which properties match what you are looking for, make a shortlist and then request ‘Particulars of Sale’ (unless you have an IPad to take around with you and you can makes notes on it?) These are like the Scottish Schedules but are most definitely not the glossy brochures which you might expect. Most Particulars of Sale tend to be black and white photocopies or maybe even coloured copies, if you are lucky.
- View the properties on your shortlist
Only by viewing similar properties will you get a feel for what is available and the area you are interested in. Only then will you know what the market will bear and what to offer.
- Never make an offer without doing your homework
For example : How long has the property been on the market? Does the photo give you any clues (snow, trees in bud etc)? Is there other interest in the property? Has there been a price reduction? Why are they moving (job move, redundancy, noisy neighbours etc.)? You will be best placed to know the right price, as you will have been looking at other properties in the area.
- Check out recent prices paid for properties in the area
You can do so by visiting HM Land Registry’s website. By entering a postcode you will have access to recent prices paid for specified properties but be sure to note the date it was paid as that is crucial!
- Offers are usually made verbally direct to the estate agent
In Scotland, offers are usually made formally by your lawyer. Lawyers only get involved ‘down south’ after the deal is agreed.
- Do speak to the estate agents to glean as much information as you can
But remember they act only for the Seller, so they will not be on your side. Their main objective is to get you to make as high an offer as they can (they get paid a percentage) so best to keep your cards close to your chest.
- Never offer the full price
Always offer less and then inch up towards the asking price. This is the complete opposite to the position in Scotland where you offer over the asking price or, increasingly common these days, the fixed price.
- Never expect your first offer to be accepted
There is usually a period of a day or so of going back and forth with the verbal offers : remember Phil and Kirsty on Location, Location, Location?! However, much will depend on the state of the property market and, in the current climate, it might be worth going in at 10 - 20% under the asking price as an opening gambit but clearly a lot will depend on the economic climate, the circumstances and the property.
- Consider the terms of the lease when deciding what to offer for a leasehold flat
For example : When was the lease granted? How long is left to run on the lease? Is the landlord engaged or disinterested? If you do not know, say the offer is subject to there being ‘no issues with the lease’ and go back later on price if there are issues. Nowadays leases are usually granted for a term of 999 years with the tenants (eventually) being in control of their own block as a management company will be set up to own the freehold and to run the block. However, many existing leases are likely to be what’s left of a 99 year lease and may need extending or have other issues. If there are less than 60 years remaining, you are unlikely to get a mortgage. Also, be sure that when you sell on there are likely to be enough years left so that its mortgage able, otherwise you will struggle to sell the flat.
- Making an offer does not legally bind you
So do consider making a cheeky offer if you think the property has been hanging around for a while. You can always go back and offer more : think Phil and Kirsty on Location, Location, Location!
- When your offer has been accepted
Try and get the Sellers to confirm that the property will be taken off the market and not shown to any other prospective buyers. This means you will have a clear run at buying the property and avoid any ‘gazumping’ where someone comes in with a later, higher offer. You may find that the Sellers will only agree to this once you have instructed a survey, ie put your hand in your pocket, as they will not wish to miss the market.
- When making an offer by e-mail or in writing
Always be sure to use the words ‘subject to contract and survey’ wherever you mention the price. This will avoid inadvertently creating a contract.
- Once the deal is done, only then are lawyers instructed
When the terms are agreed the estate agent will prepare a ‘Memorandum of Sale’ (stating the price, both parties details, any specific terms etc) and will send this to both sets of lawyers so that they can start the legal process.