A series of useful questions & answers, divided by categories, offering information about property purchasing in the United Kingdom.
If you do not find the answer you need, do not hesitate to contact us!
To sustain the economy the british government ha announced a series of measures which have indirectly resulted in a further increase in real estate prices: - Help to Buy: Equity Loan www.helptobuy.org.uk/equity-loan/equity-loans - Help to Buy: Mortgage Guarantee www.helptobuy.org.uk/mortgage-guarantee/how-does-it-work - Shared ownership www.helptobuy.org.uk/other-housing-options/shared-ownership - NewBuy www.helptobuy.org.uk/other-housing-options/newbuy The government has also allocated £ 3 billion in emergency loans to the construction sector
Buying Agents act in the interest of the buyer, not the seller as they are paid buy the buyer. Estate Agents work on behalf of the seller and no matter how nice they appear, they are being paid a big commission by the seller and they will always try and achieve the best price and deal for the seller.
Buying Agents do all the work that estate agents don’t do and that would otherwise need to be done by the client. They will take time to explain everything in detail to the client and hold the clients hand through the whole purchase process, which is very useful if a client does not speak English very well, does not live in London, does not understand the mechanisms of the London property market or does not have the material time to devote to buying a property in London without the assistance of a professional.
25% of sales in the UK do not complete even after a price has been agreed by vendor and buyer! Property Finders minimise this risk for the buyer.
Buying Agents services include: – establishing property finding criteria, establishing client has funds and is in a buying position also assisting with mortgages, helping find the right properties, negotiating price and terms on behalf of the client, ensuring the sale process goes to completion in the least amount of time
Yes. Buying Agents connect clients to other professionals who can help with financing, conveyancing, surveys, decoration or building work, letting or property management, etc.
Buying Agents manage the search by speaking to many agents, private sellers and searching property portals some of which are not public.
Buying Agents filter out properties so clients view only the properties that meet the buying criteria. Buying Agents will visit properties before they take clients along, assess if the properties are actually suitable (as opposed to estate agents who just want to sell the property for the vendor), then give the client clear honest advice, accompanying the client on the viewing. This means that clients only see 25% – 50% of the properties a buying Agent has viewed, saving time and resources for the client, rather than confusing the client with unsuitable properties.
Buying Agents have inside knowledge about the area, streets or buildings, or even about how to secure a property that will never be marketed.
Buying agents have negotiating tactics and skills and will handle all conversations on behalf of the client and advise on which approach is best. They have ability to influence real estate agents with respect to the seriousness of the offers proposed by the customer and the customer’s ability to purchase immediately. In a competitive property market like central London this is very important, as estate agents prefer to deal with professionals like themselves who know have qualified clients and have prepared clients to place serious offers.
Buying Agents won’t waste a client’s time as the majority of their remuneration is paid only on completion of a purchase and thus have all the interest to find a property quickly for the client and move onto the next client
Clients need to pay an upfront fee to cover initial costs of a buyer agent and more importantly to prove to any vendors estate agents, developers that the client is in a purchasing position and thus obtain the best deals on the market which otherwise would not be available through normal estate agency services
Buying Agents have access to “off market” or“pre market”properties or to new properties before they are openly marketed because they have strong relations with estate agents who respect the Buying Agent would only working for a serious buyer. Estate Agents like property finders because as fellow professionals in property, neither has any interest in wasting the others time (for them it’s a job not a hobby!).
Buying Agents can secure you a home instead of another potential buyer, who may at first seem more attractive (like a cash buyer) due to their knowledge, experience, relations and most importantly because they have a clear mandate from a serious buyer.
Buying Agents will only fairly represent one buyer in each price category and area (if they have 2 buyers with a £1million to spend in Chelsea, they would have to pick a favourite, so they avoid having competing buyers). Clients will have between 3 to 6 months of service in return for a retainer fee. The commission paid can be saved in monetary terms when: Buying agents negotiate better than clients would Buying agents find a property that a client wouldn’t have otherwise seen Buying agents save clients time and effort.
Buying Agents charge a ‘retainer’, which can vary from £500 to a few thousand pounds upfront. To ensure clients are serious and not a time-waster, the upfront payment guarantees their attention and hard work. Once clients purchase a property through the buying agent they will charge between 1% and 2.5% of the property value.
Yes. These professionals are independent from OPISAS and will charge separate fees.
Land Registry Office Copies
Just before completion, the conveyance or solicitor checks the vendor is still the registered owner of the property.
Bankruptcy Search for purchases with mortgages
Mortgage lenders will want confirmation that the buyer hasn’t recently gone bankrupt.
Local Authority Searches
The costs vary from Borough to Borough.
This is to check the property has connection to fresh and foul water sewers.
Chancel Repair Liability Search
This is to check whether the buyer liable to pay a contribution to the upkeep of the local parish church.
Checks for evidence of contamination on (and round) the land being purchased.
Location Specific Local Searches
Checks for coal mining, limestone mining, Cheshire bring, China clay mining and tin mining may be required.
The offer OPISAS will get in touch with the seller’s estate agent and negotiate a purchase price for our client. Once the seller has accepted our client’s offer, the seller’s estate agent will write to confirm this. OPISAS will provide the seller’s estate agent your solicitor’s or conveyancer’s name and contact details and OPISAS will provide your conveyancer details of the property, the estate agent, and the sale price and of the mortgage lender if applicable. Once an offer has been accepted, the property might still be advertised as ‘sold subject to contract’ or ‘under offer’. This means there is an agreement to buy and sell a property, but the buyer or the seller could pull out without penalty. OPISAS will ask for the property to be taken off the market, but it’s only when contracts are exchanged that clients make a financial and legal commitment. Appraisals Legal - Conveyancing The legal work to transfer a property is called conveyancing. The conveyancer will arrange for clients to sign the mortgage deed and will carry out some checks for the lender, such as confirming that he or she is satisfied with the title to the property. The buyer’s conveyancer or solicitor will also liaise with the seller’s solicitor, with the mortgage lender and with the estate agent, and make sure clients understand the details. The conveyancer will get in touch with the seller’s solicitor to: • Check that everything is in order with the registered title • Get copies of any supplementary deeds that may contain restrictions • Get copies of any guarantees that benefit the property • Get copies of planning documents for the original construction if the property has been built recently, or for any extensions and structural alterations • Obtain a local authority search and searches covering any relevant environmental issues Most solicitors usually insist on the fee for searches being paid upfront Once all the research is finished, the conveyancer will send clients the pre-contract report. Buying a leasehold property Many apartments and some houses are leasehold properties. This means that the buyer ('leaseholder') acquires ownership of the property but not the land that remains of the 'freeholder' who charges an annual rent 'ground rent' (land rent) and 'service charges' for costs maintenance of the common parts of the building during a specified period 'lease'. At the end of the lease, the freeholder obtains ownership of the property but in practice the lease is extended well before the deadline and you also have the option to buy the title from the freeholder. Normally during the purchase of a leasehold property, buyers need to understand all the implications and obligations related to the lease, and the solicitor will have to do additional research. Preparation for the exchange of contracts Once the conveyancer has all the details, he or he will send clients a pre-contract report and a copy of the registered title. If clients are happy with everything, they will need to approve the contract by signing it. The exchange of contracts When the solicitor or conveyancer has the contract signed by the buyer and the seller's solicitor has the contract signed by the seller, the two solicitors are exchanging contracts. The buyer's solicitor will also transfer the deposit (money that the customer pays his l solicitor before the exchange of contracts) to the vendor's solicitor and set a date for completion, normally from Tuesday to Thursday. If the buyer changes his mind after this point, he loses the deposit. Preparing for the completion of the purchase Once contracts are exchanged the conveyancer or solicitor will make the final preparations for the completion of the sale. Land Registry The conveyancer will have sent clients a copy of registered title for the property at the start of the process. Now the conveyancer will do a final check to make sure that nothing has changed. 'Transfer deed' This is the document that records the client as the new legal landowner in the Land Registry. The conveyancer will prepare this before completion, and send it to the seller’s conveyancer. The solicitor will prepare this before completion, and send the vendor's solicitor. Transfers of money The conveyancer will also make the final arrangements for payment, including receiving the mortgage money for the client from the lender. Final accounts The conveyancer will prepare the final accounts for the client. These will include details of any further money needed from the client to complete i.e. the conveyancer will arrange for the mortgage money to be transferred to the seller's conveyancer on the agreed completion date, but the client will need to provide the difference – less the amount the client already paid as deposit. Completion Day • The solicitor will transfer the payment to the seller. If the buyer has a mortgage, this money will have been sent from the lender to the buyer’s solicitor. • Once the full payment has been transferred, the buyer will receive the keys to the property and the solicitor will receive the transfer deed and originals of any other important documents. • The solicitor will complete a tax return to pay the stamp duty land tax, which the client will need to sign before they send it off. The solicitor will then arrange for the Land Registry to record the buyer as the owner and register the lender’s interest as a mortgagee (the buyer is the mortgagor).
PBSA's are purpose-built accommodation for students distinguished from residential buildings not constructed for that purpose but used by students. PBSAs are normally located close to schools and universities and may offer services for students such as laundry, common areas, reception, lobby, bicycle parking; some luxurious buildings offer gymnasiums, saunas, swimming pools, steam rooms and many other services.
The UK is now the world's second largest destination for international students and its position has risen from 11% to 12% over the past 10 years as while the U.S. position has decreased from 28% to 20%.
London is constantly growing for the following reasons: - It is leading global financial centre - It is most visited city in the world (15 million visitors) - English language that predominates in the business world is spoken - It has an efficient legal system that - It has a stable political system - It has a stable and independent currency - It has the largest global air traffic hub with 6 airports - It has excellent quality universities attracting the best talent globally - It is a global centre for culture, fashion and shopping - It has a competitive tax regime compared to other Western countries
Real estate prices in London increase for the following reasons: - Immigration and population growth of about 100,000 inhabitants annually - Interest rates are at historic lows - The City continues to expand and professionals in real estate reinvest in real estate - Contraction of building activity: -4.5% (private sector) and -8.7% (public sector) - Ease of disinvestment due to demand/supply imbalance: 12 buyers for each property
Foreign investors buy London properties consistently for several reasons: - Acquisition of residence - Investment through rental or resale - Protection of capital and excessive taxation in own country - Prestige - Accommodation for children, often students - Use as a second home (pied-à-terre) or holiday home
OPISAS is able to provide clients with information on prices, rents and yields in real time for any specific area of London.
The Commuter Belt is the metropolitan area surrounding London from which it is practical to travel to work in the capital. The boundaries of the Commuter Belt are not fixed but are expanding with both the improvement of transport services and infrastructure as well with rising real estate prices in London which make it more affordable to purchase a home further way from the central London.
Greater London is AN area within the M25 further divided into Inner and Outer London.
Central London Mayfair Westminster e Victoria Belgravia Pimlico Sloane Square Knightsbridge Chelsea South Kensington Bloomsbury Fitzrovia Covent Garden Soho Clerkenwell Spitalfields Barbican West London Notting Hill Holland Park Hammersmith Fulham Shepherd's Bush North West London Little Venice, Warwick Avenue e Maida Vale St John's Wood Swiss Cottage Belsize Park Primrose Hill Hampstead Highgate Hampstead Village e Finchley Road West Hampstead e Fortune Green North London Camden and Kentish Town Islington East London Wapping Shadwell Canary Wharf South East London Rotherhithe Surrey Quays Greenwich South West London Clapham Battersea Putney Wimbledon Barnes Kew Richmond Twickenham
Prime London property includes those areas with an average value of more than £1million while Super Prime includes those areas with average values of properties in excess of £10 million. Other sources define those areas with Prime London property prices over £1000/ft2 and Super Prime those areas with prices above £ 2000/ft2. To date 54 billionaires and 281,000 millionaires reside in London.
- Prime London: 49% - Inner London: 20% - Central London: 7%
a) Property price <£ 450/ft2 (<€ 6000/m2) - 80% of buyers purchase to reside of which 80% for the first time buyers - The properties are located primarily in Outer London b) Property price £1,000-£1500/ft2 (€ 13,000 - € 20000/m2) - 70% of buyers are investors - The properties are located primarily in Inner London and Prime London c) Property price > £2000/ft2 (> € 25000/m2) - 70% of buyers purchase to reside and such properties are mainly second homes - The properties are located primarily in Prime London
Investors prefer smaller units (studios, 1 bedroom or 2 bedrooms) as prices are more affordable, yields are greater and also because such properties are easier to manage compared to bigger properties.
Thanks to leverage, paying a 10% deposit and selling before completion of build one earn 100% of the capital invested if the property prices increase by only 10%. This is a real possibility in the London market.
OPISAS helps investors to maximize returns on off plan real estate by selecting properties in areas of real estate price growth (e.g. regeneration areas) with payment of low deposits and sometimes with discounts on the purchase price with respect to official valuations.
High ROI (Return On Investment). Selling an off plan property before completion, avoids the buyer paying the Stamp Duty (1% to 15% depending on the value of the property) which is paid only for the purchase of built properties only. Off plan property, once built, benefit from a 10-year structural warranty issued by the National House Building Council (NHBC). Buying property is an easy and hassle free: - One buys a contract; - There is no need to obtain a mortgage; - There is no need to rent and manage a property. A new build property is easier to maintain, manage, rent and sell. Purchasing off plan properties an investor can choose the best units, with the best views and can select the best finishes, etc.