Home » Costs involved in the purchase of a freehold property

Costs involved in the purchase of a freehold property

How much will the work cost?

Fixed fees

We, like most solicitors charge a fee proportionate to the value of the property, so the fee you will pay depends on the price you are paying for your property, together with a number of factors including the complexity of the title and your funding arrangements.

Generally, the fees for work associated with purchases are higher than that with sales (of a comparative value) as there is more work involved.

Our fees range from £1,000.00 plus VAT for a freehold property priced up to £250,000 to £2,000.00 plus VAT for a freehold property priced at £1.5million.

Example quote for a freehold property purchased for £500,000:

(* this figure is for illustrative purposes only)

In what circumstances may the costs change?

We want to ensure you only pay for the service you receive, so, as an example, a simple freehold purchase with standard funding arrangements will cost less than a complex freehold purchase involving a lender who requires us to undertake additional work on their behalf.

Some factors which could typically increase the cost of the service you require are:

• if the legal title is defective;
• if the title is unregistered;
• if there is a management company that we need to engage with to ensure compliance with any regulations which may apply;
• if we need to obtain a certificate of compliance for a restriction on the title;
• if the property is subject to a rent charge;
• if we discover that the correct consents have not been obtained for alteration works;
• if you are obtaining financial contributions from third parties;
• if you are purchasing under the help to buy scheme or using a complex funding arrangement;
• if you have the benefit of a Help to Buy ISA;
• if you are purchasing through an auction or from a lender under a power of sale, with tight deadlines to meet;
• if documents or information are requested from you or any other party, which requires our work to be duplicated;
• if the property is a new build or is being transferred out of an existing title.

What are disbursements?

Disbursements are charges levied by third parties which apply to your transaction, and which we will pay on your behalf. These costs are fixed by the third-party supplier and we cannot influence them.

Which disbursements may apply to my purchase?

Stamp duty land tax/land transaction tax

Please refer to HM Revenue and Customs for relevant rates, or if the property is located in Wales, the Welsh Revenue Authority.

The figures payable may well be different depending on whether you are buying in England or Wales.

The rules regarding the payment of stamp duty land tax or land transaction tax are complicated and may also be affected by other factors including whether you will be replacing your main residence or if you are buying a property to let out etc

Below are links to HMRC and WRA calculators which will assist you in working out how much SDLT or LTT will be due if you proceed with the purchase of your property

Stamp Duty Land Tax Calculator

Calculate Land Transaction Tax | GOV.WALES

HM Land Registry fees

Please refer to HM Land Registry for relevant rates.  The above fees are not subject to VAT.

Below is a link to the HM Land Registry website which you might found useful in working out what the relevant registration fee may be for registering you’re a property’s change in ownership

Fees Calculator (landregistry.gov.uk)

Searches

These costs are not fixed. Each search provider will charge a fee for their service and each local authority, water authority (etc.) will have their own fee scale. On average, the searches you will require cost between £350.00 and £450.00.

Any variation is accounted for on your completion statement during the course of the transaction.

Some searches are subject to VAT.

Electronic transfer fee

The charge levied by the practice (which includes the cost payable by us to the bank) is £[amount] inclusive of VAT.

What we will do for you

We will let you have a breakdown of what our fees include, when we provide you with a quote. It may include some or all of the following matters:

• approving the contract and if required, negotiating amendments;
• reviewing the legal title to the property;
• undertaking searches and raising enquiries;
• reviewing your funding arrangements;
• reporting to you on our investigations;
• acting on behalf of, and reporting to your lender;
• accounting to you with a completion statement and requesting monies from you;
• exchanging contracts and undertaking pre-completion searches;
• completing the purchase for you, paying the purchase price and any monies agreed for any items to the seller’s solicitors;
• submitting your stamp duty land tax return to HM Revenue and Customs (or where the property is in Wales, submitting your land transaction tax return to the Welsh Revenue Authority) and paying any duty owed;
• registering your ownership of the property with HM Land Registry;
• sending copy documents to you following registration together with any other documents which you may need when you come to sell the property.

How long will it take?

Generally speaking your purchase should take between six and ten weeks to complete but this depends on many factors, including the speed of your searches, mortgage offer and the co-operation of all parties.

If you are in a ‘chain’, any dates will need to be agreed with all parties.

In what circumstances will the above matters not apply to me?

It is important to note that the information above relates to residential conveyancing for individuals who are buying a property to live in.

If any of the circumstances below apply, it is likely to involve additional work, or you may require advice from another department within the practice:

• if you are purchasing the property as an investment;
• if you are purchasing in the name of your limited company or a partnership;
• if the property you are buying is to be transferred out of an existing title and documents need to be drafted.

Overview of the conveyancing process

As members of the Law Society’s Conveyancing Quality Scheme we follow the Law Society Conveyancing Protocol which is designed to make the conveyancing process as straightforward and efficient as possible.

The steps involved in the purchase of your property will include the following:

• Once we have received a memorandum of sale from the selling agent, or details of the transaction from you if your matter is a private sale, we will ask you to complete a short questionnaire, provide evidence of identity and your funding arrangements, including evidence as to the deposit, and to put us in funds to enable us to commence searches.
• The seller’s solicitors will supply us with a contract pack, including title deeds to the property, a plan, protocol forms (a property information form, and a fittings and contents form), a contract and the energy performance certificate.
• We will check title to the property, order searches, approve the contract and draft a transfer deed. We will also raise any relevant enquiries with the seller’s solicitors so that we can report to you thoroughly.
• We would recommend you have a survey carried out, as we are unable to advise you on matters such as the physical structure of the building. If you are getting a mortgage, your lender will also carry out a valuation of the property, but please remember that the valuation is only for the benefit of the lender and you should not rely on the valuation. You should let us have a copy of your survey and mortgage valuation.
• Once we have received your mortgage offer, searches and replies to enquiries, we will provide you with a written report on the property for you to consider.
• We will also send you a contract and transfer deed to sign, or you can attend the office to sign them and discuss any questions you may have.
• If we are also instructed in your sale, we will ensure that the two transactions can exchange simultaneously, and supply you with completion statements setting out the costs and disbursements incurred in relation to each matter.
• As soon as all parties are in a position to proceed, we will exchange contracts. This is the point at which the agreement is binding, and you cannot pull out of the transaction without incurring penalties. At the point of exchange you should book your removals and put your buildings insurance in place as this is when the risk of the new property will pass to you.
• We will order your mortgage advance or ask you to put us in funds for any balance required to complete.
• On the completion date, funds will be transferred between solicitors and once completion has taken place, we will notify you and the selling agents so that keys can be released to you.
• Post completion we will submit your stamp duty land tax return to HM Revenue and Customs (or where the property is in Wales, submit your land transaction return to the Welsh Revenue Authority) and pay any duty owed. We will also register you as owner with HM Land Registry and supply you with evidence once HM Land Registry has completed our application.