A guide to buying a property

An introduction to 'The Property buyer's guide'

Moving house is well known to be one of the most stressful things you can do, with large sums of money involved and the process potentially fraught with difficulties and frustrations. Luckily, you will not do it very often, but Green2Blue deal with it every day, so we have written this short guide to remind you of how the process works and some of the challenges you will face and to give you the benefit of our “inside knowledge”.

The process of buying a house

This is an overview of the process for the property buyer.
Make a decision on property requirements, location and price
Look on the property web portals and local papers
Register with local estate agents
Review appropriate property details
View properties
Make an offer and have it accepted
Progress the legal work and exchange contracts
Complete the sale and move in

Deciding what type of property to buy

One of the best things you can do is sit down with all of the family and decide exactly what you want to have in your ideal property (unfortunately, you will need to bear in mind the realities of what can be achieved in your price range). Write it all down and the more specific you can be the better – price range, how many bedrooms, how big a garden, what size lounge, garage or off-street parking, what sort of location, local facilities and transport, age of property, condition and maintenance requirements, development potential etc.
Apart from clarifying your own mind and bringing out any potential conflicts that may exist, it will make life much simpler when talking with property specialists like Green2Blue and give you a scorecard against which to evaluate properties you see. You will almost certainly end up compromising some of your requirements, but at least you will know by how much and why.

Deciding what price you want to pay

Before you even start to look at properties calculate how much you can afford. This includes savings to put towards the move and any loans such as a mortgage that you will be taking. For mortgages make sure you have an authorized letter from the lender that they will allow you to borrow an agreed sum.
When working out how much money you require do not forget to include the following:
Price of the property. Do not forget that you require the deposit, which is usually 10% of the value of the property. This deposit is required up front before you can get a mortgage to give to the solicitor. However, you may be in a chain.
Mortgage arrangement fee. For example if you have selected a fixed mortgage the broker usually asks for a holding or arrangement fee, which is about £400 and is non refundable.
Solicitor fees. These are about £300 to £1000 and cover necessary legal work such as setting up and completing your contract.
Removal fees. You will require pantechnicons or hire vans to move your possessions to your new property.
Surveyors fee. About £400, however this depends on the level of detail you instruct the surveyor to survey.
Stamp duty :-

a. Up to £125,000 - 0%
b . £125,001 - £250,000 - 1%
c . £250,001 - £500,000 - 3%
d . £500,001+ - 4%

It is very useful to check your calculations with your advisors before you start, always remember the majority of quotations may not mention the addition of 17.5% VAT.

Choosing an estate agent to buy your house through

It is worth registering with some of the local agents who market properties of your type. However most potential purchasers now use the internet to search for properties for sale.  More than 70% of residential properties that are for sale are displayed on Rightmove.co.uk and the agent handling the sale can be contacted by telephone or email
Green2Blue will carry out a personal search for you if you want to make sure you don’t miss the ideal house.

Preparing for viewings

If the agents are doing their job (and if the sellers have read our Green2Blue seller’s guide!) they will have presented their property at its best. The way they do this will give you as the buyer an indication of how well the property has really been looked after. You will be getting a survey of the property done later, but it is worth seeing at this stage whether it is a property with lots of problems that have been shoddily covered up or whether it is basically sound and has been well-maintained. If the sellers have not bothered to try making a good impression, that may be an indication of their attitude toward the maintenance of their property in general.
It is worth doing a bit of research before you view a property – have a look at local maps to see whether it meets your requirements for amenities and transport, ask the estate agent about the area and other properties.
Bear in mind that the area may be very different at weekends and on weekdays. Check your journey times at the time you will actually make them, not at 10.00 on a Sunday morning. If you are serious about the property, pass by at various times of day and night and stop, look and take in the ambience of the area.
After you have seen a property, give the estate agent some constructive feedback, even if you are really not interested in the property. Your feedback will help the agent find the right property for you and will also be of great help to the sellers (if you are selling as well, you will appreciate helpful feedback from people who view your property, so help the world go round).

How to make an offer on a property

When you are making an offer, you will be considering a lot of factors:

• How close is the property to your ideal?
• How does the price compare to other properties you have seen?
• What is the limit on finances given the offers you have on your own property?
• How much will you have to spend quickly to make the property live-able for you?
• Will someone else make a better offer?
• What time pressures are you under from your sales chain?

All sellers are different and will be considering their own changing circumstances when evaluating any offers they receive. Making a quick offer at the full asking price does not necessarily mean that you are over-paying for a house, any more than offering significantly below the asking price means you are getting it “cheap” – the level at which an offer is made and accepted is just a balances of many changing factors for both buyer and seller and the right timing.

The property specialist is obliged to notify the seller of all offers received, but they are working on behalf of the seller and trying to optimise the price achieved for the property, having regard for all the factors that need to be considered. The seller may well have asked the agent to pass on details of their current circumstances to buyers so it is well worth talking to the agent before making your offer. If the seller is in a strong position and has instructed the agent to wait for an offer at the full asking price, you may just provoke a bad response by insisting on an offer at a lower level. However, if the seller needs a quick move, having found a property themselves, it is well worth explaining your own position and making an offer at a level you can afford.

The agent will be helping the seller to evaluate offers and will want to confirm the details of your position, including your position on the sale of your own property and your financial position. If you can show a firm sale and a good mortgage indication at the level required to finance your offer, that can only help your case.

7. Surveys

The mortgage lender will insist on a valuation survey to give them confidence that there is enough value in the property to cover the amount you are borrowing. The buyer generally has to pay for this, although the report belongs to the lender, but they will generally let you see a copy.
If the property is fairly new, you may not need a survey as it should be covered against serious structural defects by a NHBC (National House Building Council) or equivalent certificate for 10 years from the time of building – ask to see the certificate and conditions.
If the property is older but is conventional in type and construction and apparently in reasonable condition, a “Homebuyers Report” may be appropriate. This is not a full building survey but will give you information to support your decision to proceed and should indicate any areas where further work would be advisable.
For older properties or those with unusual features or alterations or that need renovation, a full building survey would be recommended.
A survey will usually bring up issues that have not been considered previously – whether they are major problems or just minor issues. There will usually be some discussion about whether the financial impact of these matters was included in the original offer or not. The seller will take the position that the house was “sold as seen”, whereas the buyer will say that the offer was made on the basis that the house was “perfect”. In practice, both sides will need to be flexible to come to a mutually acceptable position.
The other thing happening at this time is solicitors preparing detailed schedules of what is and what is not included in the price and that can also bring out problems. If the lovely garden shed or expensive curtains that the buyer thought were included are actually being removed by the seller, there will need to be a discussion.

8 Price negotiations

Green2Blue can be a great help at this stage by being in the middle of the discussions and avoiding them becoming personal issues for the buyer and seller. They are really just clarifications of the position as more information becomes available and have to be resolved if the sale is to Complete.
This is the stage at which things become difficult and may fall apart, particularly when the difficulties are multiplied by the number of stages in the chain and made worse by time getting short and tempers getting frayed. A lot of the problems can be avoided by raising any early concerns you have about the property and being clear on exactly what is included in the offer price. You may make an offer of a price “to include all carpets and the green curtains in the lounge and subject to confirmation that the cracks in the rear extension are not indications of a structural problem”. This is intended to clarify your offer, but cannot be legally binding on the seller. Be careful with this as the survey may or may not reveal problems and the surveyors will have disclaimers in their small print. Legally, it is the buyer’s responsibility to instruct specialists and take responsibility for condition of the property.

9. Getting the deal completed

Once your offer has been accepted, your solicitor will manage the process through to completion. Remember that neither you nor the seller are legally committed to the sale until signed contracts are actually exchanged.
The key stages for the buyer’s solicitor are:
Receive information pack from seller’s solicitor
(copy title deeds, Fixtures, fittings, contents, draft contract)
Raise additional enquiries
Initiate Local Authority and other searches
Confirm mortgage, life cover, and building insurance
Request deposit
Agree exchange and completion dates
Prepare financial statements
Forward funds to seller’s solicitor and release keys
Stamp Transfer Deed, register buyer’s ownership

10. Checklist for property buyers

Council Tax Rates

Green2Blue Properties hope you find this information useful.