Buying a Property

Buying a new property can be a complicated process. But it really needn't be with City Quays's help on hand, and this very simple step-by-step guide to the buying process.

Honestly, you'll be settled into your new home quicker than you had ever imagined following these 10 simple steps!

Step 1: Get in Contact!

What we recommend as most wise for you to do is either contact us via email or phone, or simply pop in and visit us in order to register your interest and what exactly you're looking for. It also means we can get the ball rolling straight away to bring you closer to finding your perfect property.

Step 2: Decisions, Decisions

We have at City Quays a wide range of properties for you to choose from. So, before we begin the search it is important for you to consider exactly what you're looking for. A few things for you to consider might be the size and type of property, the area you wish to move to, as well as transport links available.

These aspects are very important to give thought to. For example, if you have a family, then you may consider the schools in proximity to the property, or, if you are buying to let, consider the fact that tenants often look for access to amenities and good transportation links.

Step 3: Getting those finances in order

The quicker your finances are in order, the quicker you'll be able to act when that perfect property comes along.

It is important to figure out exactly how much you can afford, which mortgage to choose, as well as considering and sorting out protection plans. Our advisors are happy to help you with all of these things however to make it that little bit easier for you. So just get in contact!

Here are a few costs that it is important you consider when planning your budget:

• Agent's fees
• Solicitor's fees
• Valuation
• Stamp duty
• Land registry
• Local authority searches
• Bank transfers
• Mortgage fees
• Insurance
• Removal fees
• Disconnection and reconnection of services
• Essential rebuilding or redecorating

A contingency fund to cover any unexpected costs is a good idea too.

Step 4: Finding the perfect property

Once you're certain about the type of property you're looking for, you have the option to choose between one of the many hundreds of properties City Quays has on offer across a number of areas.

You have the option of searching online or simply popping in to see us. We also have an email and SMS service that notifies you of properties suited to your requirements.

Once you feel you have found a property you're interested in, we'll arrange a viewing at a time suited to your convenience. At City Quays we run a number of these in the evenings and on weekends, designed specifically to fit around busy schedules.

Step 5: Making an offer

Once you've found a property that ticks all the boxes it is important to act quickly and inform the estate agent so your details can be passed onto the seller.

The seller will then consider your offer and position in terms of whether you can afford the property.

We will inform you in writing if, and when, an offer is accepted.

Step 6: Offer Agreed

So, after all that searching you've found the perfect property, placed an offer, and this offer has been accepted. This stage is known as 'sale agreed'.

Now at this stage a solicitor will have to get involved in order to deal with the financial aspects of the sale.

At City Quays we are more than happy to recommend solicitors to you, making the whole process that little bit easier for you.

Step 7: Conveyancing

This process occurs so that the property can legally be transferred from its current owners to you. As part of this process, your solicitor will do the following:

• Raise any enquiries on receipt of the draft contract from the seller's solicitor, and check for any inconsistencies in the lease also.
• Request their own local searches
• Agree on a date for exchange of contracts

At City Quays, we will ensure you are kept well informed every step of the way.

Step 8: Finalising the mortgage

Before your mortgage lender makes you a mortgage offer, they'll require a 'mortgage valuation', to ensure you are not borrowing more money than is required for the property.

Once the lender is happy, they will send you a mortgage offer detailing the terms to you and your solicitor.

Step 9: Exchanging Contracts

The formal exchange of contracts agrees the terms of the sale and makes them legally binding on both you and the seller.

Once this has happened, you can look forward to a mutually agreed completion date. This is when the money is transferred, and the property legally changes hands.

Step 10: Time for the Move!

Congratulations! You are now due to be the legal owner of a new home! On or just before this day, your solicitor will pay what is owed into the seller's solicitor's account. Once this transfer has been confirmed, the transfer document and title deeds are yours, and everything is done and dusted!

Stamp Duty Land Tax

What is Stamp Duty?

Stamp duty or Stamp Duty Land Tax (SDLT) as it is formally known as, is a tax charged on all land and property transactions in the UK. Anyone buying a property or land will pay a tax rate depending on the purchase price and the property type.

The Old Stamp Duty

The previous Stamp Duty, known as the slab system, is charged on the ENTIRE purchase price. This meant that there were sudden increases in stamp duty once the price went above the next threshold. The Stamp Duty reform now means that 98% of homeowners in England and Wales pay less and only transactions worth more than £937,000 will pay more in tax.

Purchase Price	Stamp Duty Rate
Up to £125,000	0%
£125,000 - £250,000	1%
£250,000 - £500,0000	3%
Over £500,000	4%

Under the old system, if you purchased a property for £250,000 you would have been charged 1% in Stamp Duty which equates to £2,500. However, if the price was £1 more, the stamp duty rate of 3% would have been charged on the total purchase price, an extra £5,000 which totals a bill of £7,500!

How much will we save?

Example property	Stamp Duty	Change
£125,000	No stamp duty
Average help to buy home £185,000	Old rules: £1850 New rules: £1200	Saving: £650 Effective tax rate: 0.7%
Average family home £275,000	Old rules: £8,250 New rules: £3,750	Saving: £4,500 Effective tax rate: 1.4%
Average London home £510,000	Old rules: £20,400 New rules: £15,500	Saving: £4,900 Effective tax rate: 3.0%
£937,500	Old rules: £37,500 New rules: £37,500	Saving: No change Effective tax rate: 4.0%
£2,100,000	Old rules: £147,500 New rules: £165,750	Increase: £18,750 Effective tax rate: 7.9%

How the new Stamp Duty is different

The new and reformed Stamp Duty is now more progressive, and will only apply to the amount of the purchase price that falls within the particular duty band. This means, you will only pay the rate for the proportion of the property that is above the threshold. It is similar to income tax, and although the percentage rates appear higher on some tax bands, the overall charge will mostly be lower.

New Stamp Duty Rates

Purchase Price	Stamp Duty Rate
Up to £125,000	0%
£125,000 - £250,000	2%
£250,000 - £925,0000	5%
£925,000 - £1,500,000	10%
Over £1,500,000	12%

Under the new system, we'll use the same example as before. If you purchased a property for £250,000 you pay nothing for the first £125,000, however a 2% rate will be charged between £125,000 and £250,000 which equates to £2,500.

If you buy a property for £300,000, the 5% will only apply to the difference between £250,000 and £300,000. This 5% equates to a bill of £2,500, plus the previous 2% rate, for a total bill of £5,000

Why do we have to pay it?

When you buy a property, the change in land ownership has to be legally registered at the Land Registry. This process requires a certificate from HMRC - which will only be issued on receipt of the Stamp Duty Land Tax due on the purchase of the property. So, if you don't pay the Stamp Duty, you can't buy your new home.

Luckily, that's one of the things your solicitor takes care of so you don't have to!

1st Time Buyers

First-Time Buyer? Consider yourself lucky!

The property market has never been such a hot news topic. Not a day goes past without some mention of the impact the credit crunch is having on house prices and the effect it is having on first-time buyers in particular. BUT.far from being doom and gloom, now is in fact an tremendous time to purchase your first home!

Many lenders are looking at ways to reduce mortgage rates and introduce new products to help first-time buyers.

Shared Ownership

These offer a way of building up a stake in a property but without paying 100 per cent of the price.

For example, many deals allow the purchaser to pay for 75 per cent of the price upfront, meaning that obtaining a mortgage to cover the cost will be much easier. They will then have a chance to buy the remaining 25 per cent equity over a number of years.

In fact, some deals enable buyers to purchase 85 per cent of the purchase price while still owning a full 100 per cent of the property. No interest or rent is payable on the 15 per cent deferred, which is paid back as 15 per cent of the property's open market value at any time up to the resale of the property or within ten years. Check with one of our advisors to find the best deal to suit you.

Grab the Chance!

Developers recognise that many young buyers are desperate to get themselves onto the property ladder, which is why they are offering a range of fantastic incentives to make purchasing possible. From paying legal fees and stamp duty to assisting with moving expenses, buying from a new homes developer opens up a range of opportunities for first- time buyers.

So, with plenty of great deals and a wide choice of property around, if you are a potential first-time buyer, grab these opportunities and consider yourself lucky!

The Buying Language

You might not be familiar with all the legal and financial terms involved in the process of buying a home. Some of the key words and phrases used are briefly explained here.

If anything requires clarification you should consult your legal adviser - or if we can help, we will.

Bridging Loan

A loan to "bridge the gap" between the sale of your present property and the purchase of your new home, when the dates don't coincide (or until long term finance comes through from your mortgage lender).

Buildmark

Your newly-built Barratt home is covered by the Buildmark 10 Year warranty and insurance cover provided by the National House Building Council. You will receive an NHBC booklet which contains details of the warranty.

Completion

The finalising of the sale when all the monies are passed over and the buyer has legal right to the property.

Contract

Entered into by the seller and buyer of a property which only becomes binding on exchange of contracts, i.e. when both parties have signed the contract and the purchaser has handed over the agreed deposit to the solicitor.

Conveyancing

The legal transfer of a property from one owner to another.

Covenant

A restriction or condition affecting the property, which must be complied with.

Deeds

All the legal documents relating to the property.

Deposit

A part payment of the agreed purchase price paid by the buyer on exchange of contracts (or conclusion of missives in Scotland).

Disposition or Feu Disposition (Scotland only)

A legal document which transfers ownership of a property to the buyer.

Energy Performance Certificate

The sellers of properties in England and Wales are required to provide a valid Energy Performance Certificate (EPC). It gives details about the energy efficiency of the property.

Exchange of Contracts (in Scotland, Missives Conclusion)

The contracts are in fact two identical documents, one signed by the seller and the other by the purchaser. When these are exchanged, both sides are legally bound to complete the transaction.

Freehold

The full ownership of both the property and the land on which it stands.

Ground rent

This applies to Leasehold properties and is a sum paid annually to the Freeholder by the Leaseholder.

Home Report (Scotland only)

This report is required as part of the selling process of any property in Scotland.

Insurance

This is usually discussed with your mortgage adviser or lender when making mortgage arrangements. You will need: Contents insurance: To work out how much cover you need for a household contents insurance policy, you need to add up the value of all the possessions in your home. It is recommended that any items of particular value - jewellery for example - are specified and covered by an "all risks" policy, which applies even when the items are not in the home. Buildings insurance: Cover for the bricks and mortar of your home. It is advisable to review insurance cover regularly.

Land certificate

A certificate issued by the Land Registry as proof of ownership.

Land Registry Fees

These are paid through your solicitor to register your ownership of the property with the Land Registry. The scale of fees is fixed by the Government.

Leasehold

Land held under a lease for a number of years, on which ground rent is paid.

Local Authority Search

Carried out by your solicitor, this establishes if your new home is likely to be affected by any planning decisions.

Management Company (In Scotland: Factoring Company)

Apartment buildings usually have a management company responsible for maintaining the main structure, common parts (e.g. stairs and hallways) and landscaped areas. On some developments a management company may also maintain roads, street lighting and open spaces. The management company recovers its costs from each owner through a service charge.

Missives (Scotland only)

The name given to a contract. Missives are letters exchanged by the purchaser (making an offer for the property) and the seller (accepting the offer).

Mortgage

Most people will need to take out a mortgage - or loan - to buy a house. There are many different types of mortgages available to home buyers - your mortgage adviser will explain.

Mortgagee

The lender.

Mortgagor

The borrower (whose property is secured for the loan).

Mortgage Indemnity Insurance / Guarantee

Your mortgage lender will usually require additional security if the loan is in excess of 70% or 80% of the purchase price. This involves a once-only payment which can normally be added to your mortgage. The amount of the payment varies with the amount borrowed and the term of the loan.

Mortgage Protection Policy

An insurance policy often arranged in conjunction with a repayment mortgage, which is taken out to ensure that the loan will be paid off should the borrower die before the end of the mortgage term. Insurance may also be available to protect your repayments in the event of redundancy.

Mortgage Valuation Survey

Prior to making a mortgage offer your lender will have the property valued for "mortgage purposes". You will pay a fee (variable on the purchase price of the property).

National House Building Council

A non-profit making body whose role is to both protect the home buyer and help the industry to construct good quality new homes. NHBC inspectors carry out spot checks and regular examinations on all properties at varying stages of construction. The NHBC also provides a 10 year Buildmark warranty.

Registered land

Land (including buildings on it) the title to which is registered at the Land Registry and legal ownership of which is guaranteed.

Searches

A term used to denote the physical and written procedure for determining any adverse effects in/on a particular property, whether already in effect or planned to take place.

Settlement (Scotland only)

The end of the house buying process, when the deeds of the new house and other documents are handed over, in return for the agreed price.

Stamp Duty

Government tax on the purchase price of a property. Your solicitor will automatically handle payment on your behalf.

Sold subject to contract

Sold 'Subject to Contract' (STC) means that the seller and buyer are proceeding with the sale but the paperwork is not yet complete.

Title

The rights and liabilities that attach to the property.

Title Deeds

Legal documents describing the rights and liabilities that attach to the property and prove ownership of property.

Title report on

Solicitors' certificate confirming that the title to the property is acceptable. A Lender must have one before an advance cheque for the mortgage monies can be issued.

Will

A Will is a legal document that allows a person to make decisions on how his or her estate will be managed and distributed after his or her death. As a homeowner, it is advisable to make a will - or alter an existing one. Your solicitor can advise you.