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Buying Property in the UK
On this page, we are going to guide you through buying property in the UK, step by step.
However, you should be aware that the following advice on legal details is only accurate for England and Wales. The legal situation differs somewhat in Northern Ireland and especially in Scotland. If you want to buy property there, you should make sure to hire a local solicitor familiar with those regional peculiarities. The general framework for buying a new home applies throughout the UK, though, and this is what our overview mostly focuses on.
Don’t Blow Your Budget
To start with, you should know what your budget for house hunting is. Perhaps you have already sold your previous home overseas, or are about to sell it. How much can you reasonably expect from this sale? If a house in the UK is going to be the first property you own, you need some savings you can use for the deposit. At the absolute minimum, you should be able to afford 5%-10% of the purchase price.
Moreover, any mortgage lender will look into your credit history. If you have moved to the UK recently, this may make things a little more complicated: local banks in the UK could be reluctant to extend a huge loan to a foreign resident. Talk about your financial situation with a mortgage advisor who has successfully handled buyers from overseas before. UK residents can usually get mortgage loans that are three times as high as their annual income (or roughly two-and-a-half times for a couple’s joint income).
Last but not least, don’t forget to take one-off costs into account. Costs for a property survey, legal fees for your solicitor, Stamp Duty, Land Registry fees, a commission for the real estate agent, etc. are going to add up. You have to lay aside between 3% and 10% of the purchase price to cover the expenses listed above. Furthermore, you’ll need money for the housing search itself (e.g. for public transport) and for organizing the move, taking out building insurance, buying and installing new furniture or electrical appliances, as well as plenty of other tasks involved in moving house.
Weigh Up All of Your Options
When you have a rough estimate of your budget, you can go house hunting. In addition to looking around a neighborhood, don’t forget to get informed about prices and property developments in the area. They can give you an idea of whether your new house will be worth it in the long run.
Once you have narrowed down your choice to individual houses or apartments, you should do a practical and legal inspection of the property in question. During a personal visit, check the building carefully for proper insulation, heating, plumbing, and wiring. Cracks in the walls or ceiling, signs of too much damp and condensation, woodworm in the structure, and root damage on the grounds should all raise a red flag.
Obviously, a cursory inspection cannot replace a professional survey later on, but it can keep you from spending too much time on a house with rather substantial flaws. As for the legal and administrative side, don’t be afraid to ask questions about the status of the property.
Do a Legal “Background Check”
Has the house been entered into the Land Registry in England and Wales, Scotland, or Northern Ireland? There are quite a few unregistered properties in the UK, particularly in the Scottish Borders region. However, these can be a lawsuit waiting to happen: disputes over land titles are common in UK courts.
The home of your dreams will be either a so-called freehold or a leasehold property. Freeholders actually own the grounds, as well as the building. Leaseholders only lease the property from the freeholder who owns it. For the length of the lease, they have the right to live in the building. This arrangement is particularly widespread for leasehold apartments.
If the lease of the property is 60 years or more, you can seriously consider buying it. Unless you beat the record of Charlotte Hughes, the oldest woman in UK history, who passed away at the ripe old age of 115, you’ll settle in your UK leasehold for the long run. Always check a few details on the terms of your lease. For example, find out who is responsible for repairs and maintenance, who has to pay the ground rent, and so on.
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