Purchase of a freehold or leasehold residential property

FEE SCALE

The following scale of fees is inclusive of all legal work required to complete the acquisition of a single residential property (freehold or leasehold).

Legal Fees

Our fees for acting on the purchase of a residential property vary depending on the purchase price and complexity of the transaction.  As a general rule our fee will be 0.25% of the purchase price subject to a minimum of £1,500.00 in relation to freehold purchases and £1,750.00 in relation to leasehold purchases.

The fee estimate covers all of the legal work required to complete the purchase of a single residential property, including acting in connection with any required mortgage.

Please note that if at any stage of a transaction our instructions are changed or a matter arises which adds to the complexity of the transaction we reserve the right to increase our fees accordingly.

The amount of work involved in relation to a particular transaction can vary widely, and matters can arise during the transaction which could turn a straightforward purchase into a more complex one.  Examples of such potential complexities might be:

  • A defect in title or a problem with the terms of a title document. Such defect if not remedied could affect the use of a property, the ability to obtain a mortgage on the security of the relevant property or its future saleability.
  • The preparation of additional documents ancillary to the main transaction.
  • An issue with regard to the provision of funds or the source of funds.
  • Indemnity insurance policies may be required to protect against a minor defect in title or absence of planning permission or building regulation approval; such issues may attract additional time and expense.
  • A lengthy chain of transactions which needs to be coordinated.
  • The case becomes urgent.
  • A requirement for a Lock Out or Exclusivity Agreement.

There is a distinction made between the purchase of freehold properties and the purchase of leasehold properties as there is considerably more work involved in relation to leasehold purchases. In addition there may be a requirement for:-

  • Landlord’s consent for the sale/purchase. An application may need to be made to the Landlord for a separate document (a Licence to Assign) which will need to be entered into between landlord, seller and buyer; and/or
  • a landlord may require a rent deposit, service charge deposit or a personal guarantee be provided, especially in the case of overseas buyers.

The requirement for any such additional documents will increase the costs associated with the transaction.

Disbursements

Disbursements are costs related to a legal transaction that are payable to third parties, such as, in the context of a real estate transaction, Land Registry fees or fees payable to a Managing Agent. The payment of these disbursements will be handled by us on your behalf and we will normally require cover for those costs before paying out the same.

We will provide you with a full list of expected disbursements at the commencement of your transaction and keep you informed of any additional disbursements during the course of your purchase.

The following is a non-exhaustive list of those disbursements that are commonly incurred in connection with a purchase of a residential property:

Type of disbursement or other cost

Usual cost (as at January 2019)

Usual cost (as at January 2019)

Land Registry

(The cost of obtaining official copies of title documents, by way of example only)

£6.00 plus VAT for copies of the title registers and title plan, per each title

£3.00 plus VAT for each copy document

Electronic money transfer fee

£35.00 plus VAT

Notice fees

(payable to a Landlord for example on the registration of a Notice of Transfer and Charge  – generally only for leasehold  purchases)

This fee may vary but is usually between £40.00 and £100 plus VAT per notice.

Registration of a new share certificate in management company (if applicable)

Fee varies

Land Registration fee

This fee is based on your purchase price. (Details on request.)

Search fees

(including but not limited to, searches with the Local Authority, Water and Drainage Authority, Environmental Search and Chancel Repairs Search)

Approximately £400

Stamp Duty Land Tax

(The amount payable depend upon the purchase price of the Property.  This is a complex area and different rules may apply for example if a buyer is a first time purchaser, or if a buyer already owns another residential property or if the buyer is company)

The amount of any Stamp Duty Land Tax payable can be calculated on line:

For properties in England:

https://www.tax.service.gov.uk/calculate-stamp-duty-land-tax/#/intro

For properties in Wales:

https://beta.gov.wales/land-transaction-tax-calculator

If it becomes clear that additional disbursements will need to be incurred during the course of your purchase we will provide you with the relevant details.  We will normally request a payment on account of around £500 at the outset to cover the cost of necessary searches.

Value Added Tax

VAT, currently chargeable at the rate of 20%, will be added to our fees and several of the disbursements. We will confirm at the outset of the transaction the disbursements we believe will be incurred, and which of those will attract VAT.

Stages of the process

The stages involved in the purchase of a residential property vary according to the circumstances. However, we set out below some key stages for most transactions:-

  • Obtaining instructions and providing initial advice.
  • Undertaking checks on your identity and source of funds.
  • Checking that your finances are in place to fund the purchase and making contact with the lender’s solicitors (if applicable).
  • Receiving and advising on contract documentation and title documents.
  • Carrying out necessary searches and advising on the results of those searches.
  • Obtaining copies of relevant planning and other documentation, if required.
  • Raising enquiries with the seller’s solicitors about the property.
  • Advising on all documents and information received.
  • Advising you on joint or shared ownership of the Property (if appropriate).
  • Sending the final agreed contract to you for signature.
  • Agreeing the completion date with the seller’s solicitors.
  • Exchanging contracts and notifying you that this has happened.
  • Arranging for all monies needed for the completion to be received from the lender (if applicable) and from you.
  • Completing the purchase.
  • Filing the Stamp Duty Land Tax Return on your behalf and paying the Tax.
  • Registering you at the Land Registry as the owner of the Property and registering your lender as your mortgagee (if applicable).
  • Serving notice of your purchase and any mortgage upon all relevant parties in accordance with the terms of your lease and/or registered title (mainly relevant to leasehold properties).

How long with my purchase take?

This depends upon a number of factors including

  • The length of the chain of transactions.
  • The time it takes the seller to obtain management information from the managing agents
  • The time it takes for the buyer to obtain a mortgage offer
  • The time it takes for the buyer to obtain the results of his searches.

On average, the process takes around 8-12 weeks from the date of the acceptance of the offer. However it can be quicker or slower depending on the parties in the chain and the complexity of the transaction.