Guide to Finding a Home
Make sure you are prepared before rushing off to view a property.
Viewing properties can be the exciting part of the home-buying process. But, viewing a property that isn’t right for you geographically or financially, could end up clouding your judgement when you do find a property that’s right. After a while viewing properties can become tedious, time-consuming and even a little bit overwhelming. House-hunt efficiently and effectively and make finding your dream home a pleasurable experience.
Here are our top tips on finding a house
Before you start looking, be sure in your own mind what it is you are looking for, taking all these into consideration:
No matter how nice the house is, if it’s in an area that’s not right for you, you won’t be happy. Before you start looking you might want to consider these points:
- Are there shops and services within walking distance or would you have to drive everywhere?
- What sort of commute would you have?
- If you have a dog, is there an area close by you can go for walks?
- If you have children, what are the local schools like?
- Is there sufficient parking space in your road?
- What council tax band will you be in?
- t’s always a good idea to revisit the area you are looking to buy in, late a night to see if it’s too noisy.
- Take an overview of the are using google earth and see everything from a birds eye view right down to a street view.
When considering the type of house you want, you of course need to first set yourself a budget. When doing that don’t forget to add in al the extras that go along with buying a house which we’ve listed
Stamp Duty Land Tax
SDLT replaced Stamp Duty in December 2003 and is a tax on the purchase price of land and buildings. When you buy a property or take on a lease you may have to pay SDLT.
Stamp Duty Land Tax rates as at Dec 2011
|Purchase price of residential property||Rate of SDLT (percentage of the total purchase price)||Rate of SDLT – first-time buyers (percentage of the total purchase price)|
|£0 – £125,000||0%||0%|
|£125,001 – £250,000||1%||0%|
|£250,001 – £500,000||3%||3%|
|£500,001 – £1 million||4%||4%|
|£1 million or more||5%||5%|
You will need to instruct a solicitor or conveyancer to deal with the legal aspects of buying a property. There is no standard fee so it is a good idea to shop around for the best rate. Use our conveyancer comparison to compare up to 180 quotes making sure you get the best deal across the market.
An Arrangement Fee is a fee charged by some lenders to cover the cost of arranging the mortgage.
Lenders Valuation Costs
All lenders will require a valuation of the property to check that it is worth the price you are offering for it. This is arranged by your mortgage lender but you must cover the cost, normally before the valuation takes place. This is not a survey, but a basic valuation. Costs vary dependant on the cost of the property, for example, approximately £200 for a house costing £160,000, approximately £250 for a house costing £350,000. Not all lenders charge this fee as an incentive for you to take out a mortgage with them.
Land Registry Fee
The Land Registry is a government department which maintains the registers of all registered properties in England and Wales. The fees they charge are for changing the register to recognise the new owner. This fee is charged according to price of the property.
|Price (£)||Fee (£)|
|up to 40,000||40|
|40,001 – 70,000||60|
|70,001 – 100,000||100|
|100,001 – 200,000||200|
|200,001 – 500,000||300|
|500,001 – 1,000,000||500|
|1,000,001 and over||800|
Local Authority Search Fees
Your solicitor/conveyancer will carry out the require local searches. The purpose of these searches is to find out if there are any plans in place or being considered to build new houses or extend existing houses in your immediate vicinity. They will also check to see if any new roads or road widening works are planned. The costs for these range from £50 – £100 depending on the area.
You should never purchase a property without having a survey carried out first. Excluding the very basic valluation survey normally carried out by the lender, there are two main types of survey.
Buying a property is probably the biggest investment you will ever make. Get an experts view of what you’re buying and protect your investment.
At first glance the property may look fine, but beneath those carpets or floorboards, behind the wallpaper and in the attic, it could well be a very different story. A Homebuyers’ Report will give you a fully qualified property specialists view of your prospective new home and highlighted any potential problems there may be.
The Homebuyers’ Report will highlight any existing problems, or potential issues there may be with a property. These could include things like subsidence, woodworm and damp. It would also cover the condition of the windows and roof.
A buildings survey covers everything that a Homebuyers survey does and much more. A Buildings Survey, or Structural Survey as it is formally known, is extremely through, and as such costs a lot more than a Homebuyers Survey. Again, costs will depend on the size of the house, but around £1,000 is an average.
This type of survey is recommended for older, unusual or altered properties and those in need of work, or if you have any doubts about the property’s condition. This survey includes an inspection of all parts of the property that can be seen or easily accessed. This would not include parts of the building that are enclosed or concealed (such service ducts, sealed roof spaces, or floor voids for example) but does include the following;
•Inspection of the insides of cupboards, manholes (where the covers can be easily lifted), accessible roof spaces, ducts and service areas;
• A visual inspection of the services, such as the gas, water and electrics.
• A thorough inspection and detailed report on a wide range of issues; • A description of the visible defects and potential problems caused by hidden flaws; • An outline of repair options and the likely consequences of not carrying out repairs;
• Full rebuild costs; and
• Advice for your legal advisers and full details of any serious risks and dangerous conditions there might be.
A building survey does not include a valuation, but your surveyor may be able to provide this as an additional service.
Because of the thoroughness of the report, you should allow up to two weeks from instruction to receive it.
Other Searches and Disbursements
These are normally incurred by your solicitor/conveyancer and can include various items such as copying documents, land charge search fees, company searches, bank transfer fees and VAT. You should allow a minimum £75 for these.
Depending on the type of service you want and how far you are going, these costs could range from £300 to £3,000. Read our ‘guide to removals’for more information. Whatever you do, be sure to get at least three quotes, as prices can vary a lot for what is essentially the same service. You should also make an allowance for removal insurance, say around £25.
Estate Agent’s Fees
If you are selling a property as part of the process of buying one, be sure to take into account the fees that your estate agent will charge you for selling your property. This cost is normally a percentage of the selling price and is typically between 1.25% and 2.5%. If you have decided to sell your property yourself, you will need to take into account any advertising costs. Don’t forget to add VAT to the Estate Agents costs.
Mortgage Insurance or Mortgage Indemnity Guarantee (MIG) Fees
Some lenders will insist that you take out a Mortgage Indemnity Guarantee. This only normally happens when the percentage of your loan is more than 75% of the value of the property. This is calculation is refereed to as ‘loan to value’ (LTV). Not all lenders insist on this and premiums vary.
You may on the other hand decide to insure yourself against the possibility of not being able to pay the mortgage yourself. This could take the form of life insurance or payment protection insurance.
Payment protection insurance (sometimes called “loan protection” or abbreviated as “PPI”) covers your mortgage repayments in the event of certain problems – for example, if you are unable to work because of illness, or if you are made redundant. How these insurance policies actually work and the range of benefits they offer, can vary significantly from provider to provider. Payment protection insurance policies are often sold as part of the deal when you take out a mortgage, but it is also possible to buy a “stand-alone” payment protection policy from an insurance company on your on behalf which has no direct involvement with the mortgage
If the property you are buying has been empty for a long period of time, it’s possible that some of the main utilities such as water, electricity and gas have been turned off. Be aware that there may be re-connections costs in some cases
A few more costs you should consider are;
- Mail redirection
- Change of address notice
- Cleaning costs if the house you are buying requires it
- Loss of earnings from time off moving if you are self employed
- House hunting costs if you are required to travel long distances or stay overnight
First Time Buyer Costs
If this is your first property and you have come from living with parents, these are some other costs that you may not be aware of.
- Buildings insurance premiums
- Contents insurance premiums
- Gas bills
- Electricity bills
- Water rates