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Tips to buying a property in London

Apr - 25 - 2015
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London is a dynamic city with an approximate population of over 8 million residents. Well known for its excellent standard of living, energy, and fast-paced lifestyle, the city is also renowned for its high property prices. Though this is the case, making a profitable investment in London right now might work out to your advantage with the pound sterling being strong, however many predict this will change before the general election so you need act fast!

Investing in a London property is a long process so you need to carefully consider and plan every aspect of your buying process, because more than likely this will be the biggest and most important purchase of your life.

Finding the right property

You will need first to determine the type of property you are looking for according to your needs and expectations. Before anything, research into the different neighborhoods and property types available to you, this will then govern the prices. The cost of a house or flat is also considered depending on different zones, local amenities, transport services, schools, and local taxes, among other things too. Make a list of your requirements to make your search as efficient as possible.

Once you have a clear mind of things you need to deliberate, you can choose a real estate agency to help you in your search. Some estates agencies such as Castle Estates specialize solely on London properties, so take advantage of their expertise!

property

With London being an overpopulated city, most of the properties are flats, apartments and small townhouses, compared to other parts of the country where a lot of the accommodations are houses with gardens and garages.

The process of buying

There are two different ways of becoming a property owner:

  1. The freeholder; generally concerning houses. This is to acquire full ownership and perpetual right of a property. The freeholder owns the buildingand the land it occupies
  2. The leaseholder; a property rightfixed term. The leaseholderowns the buildings but not the ground. They have to pay rent to the land owner. Once the lease is up, the property returns to thefreeholder even if the leaseholderextendsthe contract.

There are some fees you need to keep in mind before buying a property because even if they don’t represent huge amounts of money, you have to consider them in your budget.

These costs are as followed:
  • Notary fees: usually about £ 1,200
  • The cost of searches
  • Land registration fees
  • The stamp duty: 1% for the assets and between 3% and 7% for a property worth more than £250,000
  • The evaluation feeof your property and construction of the building

You also have to think about the common expenses too. If you buy an apartment in a building running on a lease, the costs will be as followed:

  • Apartment complex fees(cleaning of common areas, elevators if thereare any,various repairs and maintenance, etc.)
  • Groundrent(thefee paid to thefreeholder) depending on the type and size of the property

The mistakes to avoid

  • Do not offer the asking price; when you have found the property you want to buy, you will have to negotiate the price in order to reduce it. A lot of the time, especially if you are not from the area, you will try to get as much money taken from you as possible. Usually you are able to get the price down but be careful to not over negotiate as this can lead you to losing the deal altogether. It is advisable to offer 10% and 15% below the asking price.
  • Do not buy the first property you visit before having looked other a few. You might think that the first one you view is your future home, but how do you know if that’s the only one you’ve seen? Sometimes, when you visit a property you immediately know that it is the good one and you might be right, but it is a big decision to make so do not rush and give yourself a tough decision to make, that way you will pay attention to the fine details and not settle for average.

 

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