GUIDE TO BUYING
Cullen Kilshaw Solicitors and Estate Agents
In today's challenging market, it has never been more important to speak to your solicitor before starting out on the purchase of property.
Do I need a survey done before I can submit an offer, how much are houses going for over the asking price, should I sell first and then buy, what is a seller's survey? For answers to these and other questions, see our Frequently Asked Questions below. We act for hundreds of buyers of property in the Borders every year, and help our clients with these questions every day of the week. If you are thinking of buying a house, pick up the phone and speak to one of our helpful staff. That first phone call may end up saving you hundreds, even thousands, of pounds. Alternatively, complete our contact form and we will contact you.
No. In the present market, it is now more often the case that an offer is submitted with a condition which says that the offer is subject to survey. This means that if your offer is accepted, you then have a chance to have the property surveyed to make sure that you are happy with its condition before the bargain is concluded. What’s more every property that comes onto the market now has to have a Home Information Pack available which includes a seller’s survey. See below for further details.
There is no simple answer to this question. It depends entirely on the property. A detached cottage sitting in a secluded location with a couple of acres and lovely open view may go for many tens of thousands over the asking price, while a family sized modern house in a large development of similar houses may only make a few thousand pounds over the asking price. Just as in most markets, the price is driven by supply and demand. A house type that rarely comes available, like a cottage out in the country on its own, will attract lots of potential buyers, and this drives the price up. A house in a large development where there are similar properties coming up for sale on a regular basis is not going to command the same premium. Location also plays its part. In these circumstances, your best bet is to speak to a local solicitor/estate agent who spends most of his working day buying and selling houses in the area. Don’t commit to a purchase price without running it past your solicitor. One phone call could save you thousands of pounds.
In the present market, you should think carefully about committing to a purchase of property before finding out how well your existing property is likely to sell. While that doesn't mean that you shouldn't buy before selling, you should at least ask the question of your solicitor/estate agent before entering into a contract where you are committed to paying across large sums of money for the purchase of your new home even if your own house remains unsold. In any event, you ought to plan for the possibility that you may require a bridging loan to help fund the purchase of your new house just in case the funds being released from the sale of your present home are not available on the day that you have contracted to pay for the new one.
The Scottish Government passed a law that came into effect in 2008 which requires every seller of residential property to make available to prospective purchasers a pack of information about the property for sale. The information must be collected and be available before the property is put on the market. The law came into effect on 1st December 2008.
The information pack includes a questionnaire completed by the seller containing a range of information about the property, dealing with such matters as any alterations that may have required planning consent or a building warrant, the providers of the various services such as water, gas and electricity, and a range of other matters. The pack also includes a seller’s survey containing a detailed report on the condition of the property and giving an independent valuation. At this stage it is unclear whether building societies and banks will be prepared to accept the seller’s survey for mortgage purposes.
Currently the majority of lenders have put a shelf life of twelve weeks on the valuation part of the survey, after which a buyer may need to instruct a surveyor to re-survey the house or ‘refresh’ the valuation to satisfy their lender that it is still a sound basis for lending the money. Alternatively a buyer may ask the seller to have the original survey refreshed.
Your first port of call should be your own bank, which will have lots of information about your present income and outgoings, and have a good knowledge of your credit history. In the present credit market, it is likely that bridging loans will be subject to even more careful scrutiny by banks, so you should make an enquiry well in advance of submitting a bid for the purchase of a property. Do not simply assume that your bank will be prepared to help you out, no matter how good your reputation with the bank.
You are more likely to be accepted for bridging if you already have a binding contract for the sale of your existing property with a completion date some months ahead, and simply want a short term loan to cover the gap in time between buying your new home and receiving the funds for the sale of your current property. This is known as a closed bridging loan, where the bank knows when the bridging will be paid back. In certain cases, Cullen Kilshaw can assist with obtaining bridging facilities from one of the major clearing banks. Again, this is subject to status, each case is judged by the bank on its merits, and a loan cannot be guaranteed.