The buying process

The Cambridge Residential guide to buying a property.

It can seem a complicated and expensive business buying a flat or a house, particularly if it’s your first purchase. We’ve helped lots of times of buyers clients and can guide you through the process so it’s as smooth as possible.

Take some time to read through our step by step guide and if you have any questions call us on 01273 204037 or email us info@cambridge-residential.co.uk and we’ll be happy to help.

First, what can you afford, and what will you be lent?
Viewing properties.
Chains.
Instruct a solicitor (conveyancer).
Found ‘the one’? Put in an offer.
If your offer is rejected…
Fantastic, your offer has been accepted. What next?
Gazumping.
The legal side.
Exchanging contracts.
Completion.

First, what can you afford, and what will you be lent?

It’s crucial to be clear upfront about what a mortgage lender is prepared to offer you, and what you can afford (not necessarily the same thing!). We will happily recommend some Independent Financial Advisors to help with this.

A mortgage is granted for you to buy a particular property, and the lender will want to value they property you choose before your offer is firm. However you can be offered a ‘mortgage in principal’, on the basis of your income and existing commitments. This could help give you credibility as to your seriousness when talking to agents and sellers.

You will also need life insurance and may choose critical illness insurance, to cover the cost of the mortgage should the worst happen. Again an IFA can advise on this.

Before finally deciding how much to spend on a property, you need to bear in mind all the additional costs, which can amount to around L2000-L5000 in total. These include:

• fees for valuation (and survey if you choose one)
• Stamp Duty
• land registry fee
• solicitor’s costs
• removal expenses
• any final bills, for example, gas and electricity, from your present home which will have to be paid when you move
• disconnection/reconnection of utilities

This excludes any costs you may want to spend on renovating, redecorating or furnishing, and it is wise to allow a contingency budget too. Things always cost more than you think…!

You should be aware that if you start the process of buying a property and then the sale falls through you may have already paid for a valuation or a survey. If the solicitor has started any legal work you may also have to pay for the work done.

You should also take into account the running expenses of the property you wish to buy. These may include:-

• community charge/council tax
• water rates
• ground rent, if the property is leasehold
• service charges, if the property is a leasehold flat
• insurance costs, including life insurance, buildings and contents insurance
• heating bills. An energy performance certificate can help you work out how energy efficient your property is.

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Viewing properties.

Now you know what you can afford, make a list of all the things you’d like, and divide them between the ‘deal breakers’ and the ‘nice to haves’. Contact Cambridge Residential about properties that look interesting, and double check that all your ‘must-haves’ are included.

Cambridge Residential provide a floorplan for almost all properties, so look in detail at this, working out whether the shape, layout and size of the rooms will work for you.

View your shortlist as soon as possible. Leave it too long and you could lose out. Here are some things to think about whilst viewing a property. Why not print this list off and take it with you.

• What’s the council tax for this area?
• Is the property leasehold or freehold?
• If leasehold, what is ground rent?
• Is there any allocated parking?
• If not what is waiting time for permit?
• Private or shared outside space?
• Which way do the windows and any outside space face?
• Does property have central heating?
• What are neighbours like?
• What are local schools like?
• What are transport links like?
• Where is local train station?
• How far are local shops/supermarket?
• Is the property in a chain?
• When do the current owners want to move?
• Any building work done on property?
• If so, are there building reg certificates available?

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Chains.

The chain is the link of properties which your seller is moving into, and the one that those people are moving into and so on. Similarly if you’re selling a property, it involves the people moving into yours, and the one moving into theirs and so on.

The longer the chain, usually 2 to 4 properties in a chain, the more problematic it can become, arranging the same convenient day for everyone to move – worth bearing in mind before making an offer.

Chains can fall apart if one of the properties in it falls through. The best way to ensure a chain progresses smoothly is to stay in regular contact with your solicitor and Cambridge Residential to make sure everything possible is being done to speed things along.

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Instruct a solicitor (conveyancer).

While you’re looking at properties, or preferably before, choose your conveyancer (a solicitor who specialises in property). Almost all properties nowadays come with a Home Information Pack (HIP), which provides the local authority searches, a energy efficiency certificate and much of the legal information that will be required by your solicitor.

We would be happy to provide you with a list of local solicitors who we have been impressed with.

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Found ‘the one’? Put in an offer.

If you find a property you like, do your homework using property websites. If it feels the right price, consider offering full price/close to full price – to minimise time wasting and the risk of being gazumped. Cambridge Residential will advise you if the vendor would be willing to accept a lower offer.

Your offers should be made with the stipulation of taking the property off the market. Getting a 'Sold' board outside is a good way to dissuade others from looking. You should ask that all internet adverts for the property be removed or are marked as ‘sold stc’, to minimize any further interest.

You will be sent a list of fixtures and fittings via your solicitor and the sellers’ solicitor. This should detail all the things the sellers will be taking with them and the things they will be leaving (this can include curtains, blinds, lightshades, carpets, cookers, fridges etc).

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If your offer is rejected…

This doesn’t always happen, but if it does, speak to Cambridge Residential to find out why. They will advise you on your next steps. You will have to decide how much you want the property, and how much you are prepared to increase your offer.

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Fantastic, your offer has been accepted. What next?

You need to tell your solicitor that your offer has been accepted, and s/he will inform your mortgage lender.

Your mortgage lender will carry out a valuation of the property before they make a firm offer to you. You may choose to upgrade this to a survey, giving you more information about the property’s state of repair.

Surveys are expensive (around L300-500 usually) but there is no doubt that a trained eye will find all the problems on a property, avoding any nasty surprises later on. If major defects are uncovered you might even think again about your purchase, or you could be in a position to negotiate the price down.

Many people are shocked by what appears like a long list of defects. But bear in mind that the surveyor’s job is to point these out to you (s/he could be held liable if he overlooks something), but if and how you treat them is up to you.

We will happily recommend surveyors to you.

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Gazumping.

After your offer has been accepted by the seller, if someone else turns up and makes a higher offer on the property, this is known as gazumping. Unfortunately nobody has the power to prevent this happening, and estate agents are obliged by law to forward all offers they receive. Sadly, there’s not much you can do to protect yourself from gazumping. But it’s worth bearing these things in mind which can help:

• offer (close to) the full asking price and request that the property is removed from the market as soon as your offer is accepted
• be flexible about the seller’s timescales
• be nice to the seller – if you've established some kind of rapport with them, it might be harder for them to let you down!

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The legal side.

Once the survey has been carried out, your solicitor will receive a decision on whether a mortgage is being offered to you, to buy that property.
Once you and your solicitor are satisfied that they have the myriad forms and documents needed, the contracts can be exchanged. You sign a copy of the contract which is passed to the seller for them to sign.

However getting to this point can seem interminable (particularly if your solicitor insists on communicating by post, not email or even phone!).

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Exchanging contracts.

A non-refundable deposit is now handed over by you to the seller via your solicitors – normally around 10% per cent of the purchase price. You may be able to negotiate this. If you do not have the money for the deposit at hand immediately, you can arrange for a bridging loan from your bank.

Once contracts have been exchanged (normally by the two solicitors) both parties are legally bound to follow through with the transaction. You can no longer change your mind – if you pull out it is likely that you will lose your deposit, and you could be sued for breach of contract. The good news now is that you no longer need worry about gazumping.

You will need to arrange the transfer of the remainder of your downpayment, as agreed.

You also need to be arranging all the practical matters related to moving house like removal firms, storage companies, decorators, builders etc. The time between exchange and completion varies from purchase to purchase, depending on length of the chain etc. It should be a mutually agreed date between you and the seller, using your solicitors to advise. It is normally somewhere between 4 weeks and 12 weeks.

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Completion.

On the day of completion the solicitor carries out final administration and as soon as the balance of the money due to the seller has been received into their bank, the keys to the property will be released to you and the property is legally yours! (Completion normally happens around midday). If you have any more questions please call us on 01273 204037.

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