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The house-buying process.

Amphlett Lissimore’s consultant solicitor Peter Colman gives an insight into the process of purchasing a new home.

Domestic properties fall into two categories – leasehold and freehold.

A freeholder owns the land the home is built on, which even includes the ground below it and the air space up to 500ft above the house. It also allows the owner to live there indefinitely.

A leaseholder owns the dwelling but not the land it stands on, and once the lease expires the ownership of the property reverts to the landowner.

As your appointed solicitor, we are responsible for raising queries with the seller’s legal representative, arranging various searches with the local authority, which will advise on planning, and building regulation consents and the adoption of roads among other things.

We also use agencies to check on issues of contamination of the subsoil, flood risks and the run of the drains. Once the searches have been conducted and all arising queries resolved, we can look to exchange. 

It is at this stage, you may discover the other parties involved in the buying chain are not all ready to complete. Some could be waiting for the mortgage funding or those further up the chain may not be as advanced as your transaction.  

If you are a first-time buyer purchasing a house for £300,000 and you or a partner have never owned a property before, you may escape paying Stamp Duty Land Tax (SDLT).  If, however, one or both of you has owned a property previously or you intend to rent it out, tax is payable. 

Worse still, if one or both of you has retained an interest in a different property, an additional rate of 3% will be levied.  

It is very important to address this aspect at the outset as on a £300,000 purchase, the stamp duty could be nil, £5,000 or £14,000 depending on your circumstances.

Once contracts have been exchanged and you are purchasing a freehold property, it is imperative that you arrange buildings insurance as the risk passes on exchange.  On a leasehold property, it is more than likely that the property will be covered by the freeholder’s insurance policy but you would have to look at this aspect on an individual case by case basis. 

Upon exchange, a date for completion is set and all parties within the chain are now committed.  There tends to be 14 days between exchange and completion so that all finances can be arranged.

On completion day, completion normally has to take place by 1.00 p.m. or 2 p.m. although the terms of contracts can differ.  There may be occasion when your seller might not meet the contractual time-scale and is still loading the van. If the delay becomes unreasonable, leaving you facing additional charges from your removal firm, you could discuss with your solicitor.

And, if the seller has left a lot of furniture and personal possessions or the property is damaged, again, you need to inform your solicitor.

Once the property has been purchased, your interest and the interest of any lender should be registered at the Land Registry.

While at the property, it is important that you retain paperwork that might be of interest when you come to sell: 

These could include:

  • Boiler Certificates,  
  • Boiler servicing reports 
  • Window Guarantees  
  • FENSA Certificates 
  • Details of planning notices received with regard neighbouring properties  
  • Notices 
  • Disputes 
  • Chimney sweep certificates  
  • HETAS Certificates.  

The more paperwork you hold and pass to me, the fewer enquiries I will have to answer on your sale.   

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