Here you will find a step-by-step guide to the homebuying process. Read through all the information you need about each stage you will need to go through to get your hands on the keys to your shiny new property.
1. Understand the timescales
The property purchase cycle generally spans between 3 to 6 months, though this timeframe can differ considerably.
Factors such as whether the property is in a chain, the circumstances of the buyer and seller, any unique conditions or agreements related to the property, and even the location can all influence the duration.
2. Work out what you can afford
Before starting your search for a new home, it is important to determine how much you can afford to pay each month.
Once you have a preliminary estimate, you can find the most suitable deal for you and provide a decision in principle, which will strengthen your position when you begin viewing properties.
Potential lenders will evaluate your monthly expenses and conduct a stress test to assess the affordability of the mortgage based on your personal circumstances. Once you have an idea of the amount you wish to borrow and the monthly repayments, you can start your property search.
3. Find your new home
For many, this is the enjoyable stage! Visualising yourself in your new home can be thrilling. However, for others, finding the right property can be a lengthy and stressful process.
Here are a few tips to help ensure success:
Be practical
This begins with your initial search. Stay realistic by keeping within your budget and focusing on the features that are essential for your needs.
Think about how long you plan to stay in the property and plan accordingly. This might mean looking for an extra bedroom to accommodate a growing family or ensuring the property has off-street parking if you expect to own a car.
While an apartment may suit your lifestyle now, consider whether it will still meet your needs in five years.
Understand the seller's situation
Before becoming too attached to a property, it is important to assess how committed the seller is.
Circumstances can vary widely, and you want to avoid falling for a home where the seller is simply testing the market or lacks genuine motivation to move – a situation known as 'gazanging.'
Additionally, ensure the property will be removed from the market once your offer is accepted, to prevent the risk of 'gazumping.' Your estate agent should be able to assist with securing this assurance.
4. Make an offer
Once you’ve found a property you’re interested in, it's time to make your offer!
Your insight into the seller's situation will guide you. If they need a quick sale, they might be more open to a lower offer, whereas if they aren’t in a hurry, you may need to come closer to the asking price.
If the property has been on the market for some time, the seller might be more receptive to lower offers.
Your agent can assist in pitching your offer at the appropriate level. Keep in mind that the seller may not accept your first offer, and there may be room for negotiation on aspects like fixtures, fittings, or necessary maintenance, which could help you secure a better deal.
5. Offer accepted
Your offer has been accepted! This is a significant milestone in the process.
However, there are still several steps before you receive the keys. After your offer is accepted, you should ensure the property is taken off the market and listed as Sold Subject to Contract.
This will prevent the seller from continuing viewings and reduce the risk of them accepting a higher offer from another buyer.
6. Find a mortgage
Typically, your Agreement in Principle (AIP) is only valid for 30 to 90 days and may have expired by the time you’re ready to proceed to the next stage.
If you were accepted previously, it’s likely you’ll be accepted again.
Even a slight difference in the interest rate can significantly affect the total cost of your mortgage, so it’s definitely worth reviewing your options!
7. Choose your conveyancer
A conveyancer is a legal professional responsible for managing the transfer of property ownership or creating legal encumbrances such as mortgages or liens.
They handle the legal documentation, conduct Land Registry and local council searches, draft the final contract, and oversee the exchange and completion process.
While not essential, arranging a conveyancer before starting your property search may help expedite the process. Your estate agent might suggest a conveyancer or offer an in-house service.
Choose a reputable conveyancer with good communication skills and a proven track record. Personal recommendations from family or friends can also be valuable.
8. Lender assessments
The next stage involves providing the necessary information to convert your Agreement in Principle (AIP) into a full mortgage application, ensuring the lender that you are a suitable borrower and that the property meets their criteria.
You will be required to submit documents such as payslips and bank statements to support your application, and the property will undergo checks.
Each lender has specific criteria regarding the types of properties they are willing to finance and will arrange an independent valuation. However, your mortgage will be based on the offer you have had accepted.
9. Property Surveys
While your lender will carry out a valuation survey, this is typically very basic, and you will need additional surveys to ensure everything is in order with your new home.
There are three main types of surveys, each offering different levels of detail:
Homebuyers Report – £300-£400
This is a standard survey, often conducted alongside the mortgage valuation, and is suitable for most modern properties.
Structural Survey Report – £1,000
For older or non-standard properties, a full structural survey is advisable. It provides a comprehensive assessment of the property and can help identify issues that may allow you to renegotiate the price. However, note that the surveyor will inspect as thoroughly as possible without causing damage, and certain areas may be inaccessible.
Snagging Survey – Free to £300
Relevant to new builds, a snagging survey identifies defects for the developer to fix before completion. You can either hire a professional or do it yourself, with online resources available to assist.
It’s beneficial to speak directly with your surveyor, as they may provide more detailed insights over the phone. If the survey reveals necessary repairs, it’s worth obtaining quotes to support further negotiations.
10. Searches
For many, this stage of the process can feel prolonged. Your conveyancer will organise several searches as part of the property transaction and usually request payment for these upfront. Some searches are mandatory, required by your lender, while others are optional.
Local authority searches
Local Land Charges Register Search (LLC1):
- Existing planning agreements and conditional planning permissions.
- Tree preservation areas near the property.
- Listed building status.
- Financial charges against the property.
- Whether the property is in a conservation area or smoke control zone.
Enquiries of the Local Authority (CON29):
- Proposed infrastructure developments, such as road or rail schemes.
- Historical data on land contamination or radon gas.
- Future planning decisions that may impact the area.
- Risk of subsidence.
Optional Enquiries of Local Authorities (CON290):
- Gas pipeline locations.
- Land enquiries and flood defence information.
- Completion notices.
- Proposals for private roads.
A typical search package includes mandatory local authority searches, environmental searches, and drainage and water checks. If any issues arise from these searches, your solicitor may order additional investigations.
Solicitor searches may include:
- Environmental search: Covers flood risk and land contamination.
- Drainage and water search: Verifies the property’s connection to utilities.
- Mining search: Necessary for areas with a history of coal, lead, or limestone mining.
- Commons registration search: Checks if the property is registered as common land.
It’s advisable to regularly check the progress of these searches to maintain momentum in the process.
11. Mortgage offer received
Another milestone has been reached!
This is your formal offer from your new mortgage provider. Before accepting, we recommend conducting the following checks:
- Ensure it matches the original offer illustration and clarify any discrepancies.
- Verify all details for accuracy, as even small errors like a misspelled name or incorrect value could delay the process.
- Carefully review the conditions of the mortgage to ensure you understand all terms.
12. Building Insurance
Obtain quotes for building insurance once you’ve exchanged contracts, as you are legally committed to purchasing the property at this stage. Having building insurance is also a requirement set by your mortgage lender.
13. Completion date
The completion date is when you receive the keys to your new home.
Once the searches are finalised, you can agree on a completion date with the seller and, if applicable, your buyer if you're selling a property.
It's important to stay flexible and consider the entire process. Many people aim to align the completion date with their monthly mortgage repayment schedule.
14. Ready your deposit
When you are ready to exchange contracts, you will need to transfer your deposit to your solicitor. This step is essential to finalise the exchange and secure the property purchase.
It is advisable to contact your bank to confirm their procedures for transferring large sums of money. This will help ensure the process runs smoothly and avoid any delays in transferring your deposit.
Another important concern is 'Friday Afternoon Fraud,' which occurs because most property completions happen on Fridays, right before banks and solicitors close for the weekend. Fraudsters exploit this busy period, and the public is often unaware of the risk. Falling victim to this scam can be devastating, so it is crucial to stay vigilant when transferring funds.
According to the Law Society, Friday Afternoon Fraud is the most prevalent cybercrime in the legal sector. Fraudsters intercept the process and redirect your deposit or sale proceeds to their own account, which can lead to devastating losses, leaving victims homeless and out of hundreds of thousands of pounds.
To protect yourself and ensure the safe transfer of funds, follow these steps:
- Thoroughly read communication from your conveyancer: They should inform you about the risks and outline how they will manage them. Be cautious, as not all conveyancers provide adequate warnings.
- Pay close attention to how your conveyancer accepts funds: Many will specify that they will not accept changes to bank details via email. If you do receive an email indicating a change in bank details, always confirm in person or by phone.
- Trust physical communication over email: Use phone numbers and contact details provided in secure documents, such as your welcome pack.
- Test the transfer: Send a small amount first, confirm with your conveyancer that it has been received, and only then transfer the full sum.
These steps will help you avoid falling victim to this serious fraud.
The general rule is to remain vigilant and trust phone or postal communications over emails when handling sensitive financial matters. This is especially important in avoiding fraud. For further details and guidance, you can read more on ReallyMoving.com.
15. Exchange contracts
At this stage, the solicitors exchange copies of the contract, forming a legally binding agreement between you and the seller.
If you withdraw now, you will forfeit your deposit. On the positive side, the seller is also legally committed to completing the sale. From this point, the remaining steps move quickly and are completed in rapid succession compared to the earlier phases.
16. Completion statement
Your completion statement will provide a detailed breakdown of the funds needed, including the deposit, stamp duty, legal fees, and any other associated costs.
17. Final searches
Your solicitor will conduct final checks, such as verifying that the property is still owned by the seller and ensuring that you have not declared bankruptcy since the mortgage offer was issued.
18. Transfer deed
You will need to sign the transfer deed in the presence of a witness, confirming your intent to purchase the property.
This signed document is then sent to the seller's solicitor. However, not all buyers are required to sign a transfer deed, so it’s advisable to check with your solicitor beforehand.
19. Funds are drawn
Your solicitor will then request the funds from your mortgage provider ahead of completion. These funds are transferred to the solicitor's account, ready to be used for the final payment to complete the purchase.
20. Paying for your house
Your solicitor will then transfer the mortgage funds to the seller's solicitor and, in return, receive the title deeds along with confirmation that any existing mortgage on the property has been fully cleared.
21. Completion
Another milestone reached—your new home is officially yours!
22. Stamp Duty payment
After completion, you have 14 days to pay any Stamp Duty owed. Check your completion statement for the exact amount. Your solicitor may have already requested these funds prior to completion to ensure timely payment.
23. Register your ownership
Your solicitor will then register your ownership with the Land Registry.
The cost for this service is listed on your completion statement and typically ranges between £200 and £300, depending on the property's value.
24. Title deeds
Once you are registered as the owner, the property Title Deeds will be sent from the Land Registry to your solicitor, who will forward them to your mortgage provider, as they typically hold them.
This marks the final stage of the home-buying process—Congratulations!