The procedure for purchasing property in the UK

Information about the UK. Geography, history, population, map, flag, visa
British law does not impose any restrictions on the purchase of real estate by foreigners. Foreign citizens have the right to acquire any type of property - residential, commercial and land - the physical or juridical person.

Property in the UK can be purchased in fluency or long term lease. Fluency (freehold) implies that the land and all buildings located on it are owned by the owner. In the freehold acquired most of the houses.

With long-term lease (leasehold) property rights apply only to buildings and the land is transferred from the owner of the new buyer in a lease for a long period - from 1 to 999 years. Apartments are usually purchased it in the leasehold, so if such a purchase should know in advance the length of land lease. Small rental period can reduce the cost of the apartment. Sama rental rate for land is calculated not on market indicators and is more par - from ? 50 to ? 500 per year.

In practice, in most cases between these two statuses - freehold and leasehold - no difference. The law strictly protects the buyer and the buyer when purchasing a leasehold can be sure that the owner of the land spontaneously does not terminate the lease.


The first step when buying real estate is a pre-selection of the object. To view the objects on the market can be a variety of ways: through the Internet, specialized publications, thematic exhibitions, etc.

Then you choose a company that will accompany the buyer during the transaction. Russians often turn to Russia's companies that sell overseas real estate through their foreign partners or offices of foreign companies located in Russia. If the buyer is fluent in English, you can contact the real estate agency, located directly in the UK. There is also an opportunity to carry out a transaction without an intermediary, thereby saving on agent's fee. However, this solution should be prepared to study the extensive documentation and individual visiting the necessary authorities. The agency also takes all of these procedures on myself, but its activity is controlled by the state, so you can be sure the legal purity of the transaction.

Intermediary company carefully studying the wishes of the buyer to the property and invited to inspect facilities. As a rule, visa, flights to the country of residence and the buyer pays for itself, other services (direct observation of objects, legal advice, translation of documents from English into Russian, etc.) are free of charge. When a particularly large transactions, the buyer can be reimbursed for all its costs associated with staying in the country. Typically, real estate inspection includes visits to five to ten objects within one or two days.

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In the absence of opportunities to come to the UK, buying real estate can be done remotely, from Russia. In this case, the algorithm of action will be as follows. The buyer and the consultant company in the UK by telephone to discuss the requirements that must correspond to the real estate purchased. In the case of a mortgage the buyer is also sending the company a request for a loan, and the company itself holds talks with mortgage lenders.

To provide the buyer with information about the objects, the agent alone visit them, and then sends the client a video with their detailed characteristics. Registration of the transaction will go through a separate law firm (see "Preliminary contract"), for the buyer need to make her general power of attorney. As a rule, it is issued as a lawyer in the UK, and then sent to a buyer in Russia. Here it is necessary to assure the British consulate.

Despite the possibility of a transaction remotely, the buyer is still recommended to come to the UK. Because only through personal inspection facilities can be obtained on these, the most complete impression.


Once the object is finally chosen, the buyer makes the seller so-called tender offer (Offer). This means that the buyer's agent began negotiating with the seller about the value of the object. Here the important role played by professional buyer's agent: it is from his experience and knowledge of the market depends on whether the reduced price.

At this stage, the buyer usually makes a small amount of cash (about ? 300) the agency to sign the agreement to continue the transaction. Regardless of the outcome of the transaction, these funds are not returned. Calculations with the seller will be held by means of transfer. To do this, the buyer will transfer funds from personal account to his lawyer, with whom they, in turn, will be credited to the account of parts of the lawyer of the seller. Direct settlements between the buyer and seller are not allowed. Open a personal account in the UK is not necessary, except in the case of obtaining a mortgage. Confirm the origin of money is not required, but the lawyer has a professional responsibility for the cleanliness of the transaction, so it may request documents on the transferred funds. For more information about opening a foreign bank account and transfer funds, see the article "Financial matters: how to pay for the deal?".

Once the parties reach a preliminary agreement on the price of the object, begins drafting the primary contract - Memorandum of Sale. It should be borne in mind that the price may continue to change, until the exchange of contracts.


Of a preliminary contract (Memorandum of Sale) and full legal support of transactions carried out by lawyers. Usually the process involves two lawyers - from the buyer and the seller. It should be borne in mind that the choice of the specialist is as important as the choice of agent, and on its professionalism and responsiveness to a large extent depends on how quickly the deal will be made.

In the Memorandum of Sale indicates the raw data of the transaction - the names and contact details of the buyer, seller and their lawyers, as well as information to which property passes to the buyer together with property (furniture, household appliances, etc.). At this stage, the buyer does not want to make a deposit, but he can do remittance to the account of his lawyer.

After signing the Memorandum of Sale lawyers begin to compile the main contract of sale - Conveyancing.


The contract of sale, or contract, drawn up in two copies - one for each side. Initially, it was a standard form, but in the course of the transaction accumulates many details.

At this stage the lawyers requests to the various local authorities. In particular, it turns out plans for further construction in the neighborhood, infrastructure development, transport, etc. During such testing may reveal, for example, that a year after buying a secluded house under his windows would be laid across the highway.

Also, the lawyer shall verify the purchaser of legal purity of the transaction, namely: who owns the building and the land, whether the reconstructed (in this case would have to obtain from the owner of the relevant plans and permits), how closely held the border station and etc. The buyer is entitled to both undertake an independent technical examination of the object.


In the course of this test (Survey) the purchaser provides information on the technical state of the object, the presence of defects, etc. Carrying out of examination especially recommended when obtaining a mortgage. The procedure is carried out by an independent engineer, appraiser. Typically, a real estate agency is helping the buyer with a choice of such a specialist.

If during the inspection revealed that the home has some faults, an expert in his opinion indicates, how much would cost to remove them. He also makes his assessment of the value of the object. As a rule, it is slightly below the alleged seller, and it can serve as a trump card in future negotiations on the price.


Once carried out the necessary checks and lawyers made up the final contract of sale, contracts are exchanged (Exchange). According to preliminary agreement on the appointed day, the lawyer sends the buyer the seller's attorney a signed contract and deposit on the first 10% of the amount of the transaction. Simultaneously, the party sends a lawyer a copy of the buyer signed the contract with the seller. Since then, the sales contract comes into legal force. After receiving copies of the seller's lawyer, the buyer transferred the remaining amount of the transaction.


Completion of the transaction (Completion) includes the payment of necessary taxes (see below) and the conducting of state registration of the transaction. The latter procedure is carried out in the Land Cadastre (Land Registry), upon presentation of a lawyer buyer of the contract of sale. Since the exchange of contracts and completion of state registration is up to 20 days. At this stage, the buyer pays and the services of an agency for real estate - minus the earlier payments.

And only after obtaining all necessary documents and payment of the buyer receives the keys of the object.


Size of stamp duty or tax on the purchase of property (Stamp Duty), depends on the value of the object:
• up to ? 125 thousand - 0%;
• from ? 125 thousand to ? 250 thousand - 1%;
• from ? 250 thousand to ? 500 thousand - 3%;
• over ? 250 thousand - 4%.

It should be noted that the ? 125 thousand - a standard amount. However, in November 2009 the interim increase in the threshold value of ? 175 thousand, imposed by the authorities to stimulate the property market.

The cost of property registration in the Land Cadastre is 0,1% of the value of the object. Municipal contributions - about ? 200. Employment lawyer estimated at from ? 700 to ? 2 thousand cost of services of an independent appraiser varies depending on the size of the facility and the company and range from ? 500 to ? 1,5 thousand services of an independent mortgage broker (in obtaining a mortgage) - 1-1 , 5% of the loan amount. Fee real estate agency will cost 1,5-2% of the value of the object.


Get a mortgage in the UK citizen of Russia is not easy. This is due to the complexity of British banks to verify the legality of the applicant's income. However, the ability to get credit still exists. As in Russia, the UK banks consider each case separately.

For non-residents the maximum loan amount is 65-70%, the standard term loan - 25 years. The percentage of credit is calculated based on the Bank of England base rate Libor (by analogy with the Euribor). Banks that provide credit, usually added to it 1,5-1,8%.

Minimum package of documents includes the following:
• application form for a loan.
• a notarized copy of passport.
• proof of financial solvency (eg bank statements for the last six months).
• at least two proofs of address of residence (for example, the sales contract and a utility bill).
• Letter from employer on letterhead of the company on salary and bonuses received by the employee for the past six months.
• a tax return.

In addition, we can provide other financial documents confirming the level of welfare (securities, etc.).


Purchasing an apartment under construction

If you buy at the construction stage the buyer gets a ten-year warranty for an apartment (on the load-bearing structures and communication). The implementation of this guarantee, the developer controls the National Commission for the residential construction UK. In addition, buying apartments being built, the buyer saves on stamp duty levied in the UK only finished apartments.

The risks associated with the acquisition of new buildings, as in other countries, is the probability of delay in delivery of the facility or the bankruptcy of the builder. Also in the case of purchasing property in the calculation of the growth of the value of the object upon completion of construction there is no guarantee how the market behaves.


By purchasing the land, should pay attention to the type of plot, namely whether it is a zone of potential development, that is, whether there were plans in the coming years to where buildings, roads, etc. The Earth is divided into the following types.
1. Plots of the zone of potential development and having a building permit.
2. Plots of the zone of potential development. Since the building permit on such land has not yet received, their cost by about 20% less land with its permit for construction.
3. Land outside the zone of potential development - strategic. These are the lands on which the authorities in the coming few years will be any construction, but they have the potential to be included in the construction zone in the medium and long term. For example, in the case of road network in the region. But while the land is not included in the zone of potential development, the owner has no right to build anything on it. Review the status of land is carried out by the authorities every three to five years. There are no guarantees that he will still be changed, no, but the cost of such land may be more than ten times lower than those on which construction is expected.


Arriving in the UK to buy real estate, but has not yet become the owner of your own home, the buyer may stay in a hotel or rent a home. Rent in the UK is different in two types: short-and long-term.

Short term rentals (Short Let) usually concluded for a period of one to six months. Most companies that specialize in renting and interested in long term, so if a foreigner looking for accommodation for a few days or weeks, it's easier to stay in the hotel. Short-term rentals typically cost 30-40% more expensive than long-term, but already includes a fee for utility payments. This apartment is usually furnished.

Long-term rentals (Long Let) is a term of six months, the most common option - for one year, extendable. Housing may not be furnished. With long-term lease all bills (electricity, water, gas, TV license, council tax) paid by the tenant.

Foreigners who do not have a UK credit history before entering must pay the entire lease term (in the short term) or six months (with long-term lease). If it can establish a favorable credit history, such payment would be required. In any case, must pay a deposit for 1-1,5 month's rent. It serves as landlord to guarantee preservation of furniture, decoration and so forth, and in the absence of any damage the tenant is returned upon departure.

Tenant and the landlord entered into between the lease agreement, specifying the details of the parties, their rights and responsibilities, characteristics of the removable housing, duration and cost of the lease. Suffice it is common practice, when the landlord to confirm the reliability of the tenant asks for his advice. They may be made by the employer, from the bank where the account is opened, or the previous landlord.

The cost of long-term rental apartments with one bedroom in London starts at ? 600 per month.

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