Purchase of a Freehold or Leasehold Residential Property Costs

Purchase of a Freehold or Leasehold Residential Property Costs

Introduction

Our Legal Fees cover all of the work required to complete the purchase of your new home, including dealing with registration at the Land Registry and dealing with the payment of Stamp Duty Land Tax (Stamp Duty) if the property is in England, or Land Transaction Tax (Land Tax) if the property you wish to buy is in Wales.

Before comparing prices, we would advise you to carefully consider these key issues:

  1. Is the firm regulated by the SRA (Solicitor’s Regulation Authority)?
  2. Is the firm a member of the Conveyancing Quality Scheme and can they act for my mortgage lender if applicable?
  3. What is the reputation of that firm? What do people say about them online and on their website?
  4. What is their service like? Do they have qualified and experienced people to handle my matter?  Do they have a support team that will help get things done?
  5. Does this firm have insurance if anything goes wrong?
  6. How will I know what is happening throughout my matter – does the firm have a way of reporting the key stages to me?

Once you are certain you have chosen the right firm for you, it is then a good idea to compare the cost of the service you will receive.

Legal Fees

Legal Fees are the amount you will be required to pay for all of the work performed by us in actioning your instructions, from commencement of your case to conclusion.

Our average standard legal fee for a residential freehold property purchase ranges from £1,180.00 – £2,450.00 plus VAT. (£1,416.00 – £2,940.00 Inc. VAT) plus disbursements, depending on the purchase price of the property as seen in examples below:

Purchase Fees Freehold Average Fees (Cost exclusive of VAT) VAT Total
£0,00 to £250,000 £1,180.00 £236.00 £1,416.00
£250,000 to £400,000 £1,550.00 £310.00 £1,860.00
£400,000 to £600,000 £1,700.00 £340.00 £2,040.00
£600,000 to £800,000 £1,900.00 £380.00 £2,280.00
£800,000 to £1,000,000 £2,150.00 £430.00 £2,580.00
£1,000,000 to £1,500,000 £2,450.00 £490.00 £2,940.00
£1,500,000 + £2,450.00 £490.00 £2,940.00

Our average standard legal fee for a residential leasehold property purchase ranges from £1,680.00 – £2,950.00 plus VAT. (£2,016.00 – £3,540.00 Inc. VAT) plus disbursements, depending on the purchase price of the property as seen in examples below:

Purchase Fees Leasehold Average Fees (Cost exclusive of VAT) VAT Total
£0,00 to £250,000 £1,680.00 £336.00 £2,016.00
£250,000 to £400,000 £2,050.00 £410.00 £2,460.00
£400,000 to £600,000 £2,200.00 £440.00 £2,640.00
£600,000 to £800,000 £2,400.00 £480.00 £2,880.00
£800,000 to £1,000,000 £2,650.00 £530.00 £3,180.00
£1,000,000 to £1,500,000 £2,950.00 £290.00 £3,240.00
£1,500,000 + £2,950.00 £590.00 £3,540.00
  •  you can see a sample estimate for a property valued at £100,000 by clicking here that shows you the costs involved, including all legal fees and disbursements related to your matter.
  • The value of the property and any complexities of the purchase will dictate the final fee charged within this range.
  • For purchases using a corporate vehicle there is a supplemental fee of £15.00 plus VAT (£18.00 Inc. VAT) due to Companies House registration requirements and additional documents required for lending purposes.
  • HM Land Registry (Stamp Duty*) applies to most property purchase transactions. We can either advise you of the stamp duty applicable to your matter in routine transactions or refer you to external specialists for more complex matters and you can visit the HMRC website for more information: https://www.tax.service.gov.uk/calculate-stamp-duty-land-tax/#/intro

Other factors will also include other supplemental fees which include:

  • Help to Buy Fee £550.00 plus VAT (£660 Inc. VAT)
  • Shared Ownership Fee £275.00 plus VAT (£330.00)

We are required by our regulator to undertake Client Due Diligence (CDD) which is made of up KYC (Know Your Client) and AML (Anti Money Laundering) details of which are contained within our terms of engagement which will be sent to you when instructing us.

In addition to our standard charges as referred to above, the firm will apply a CDD charge of:

  • £10 (£12 inc. VAT) for undertaking KYC
  • We will charge the sum of £27.50 plus VAT (£33.00 inc. VAT) for electronic money transfers.
  • VAT will be payable on our fees and some disbursements, currently 20%, and we will clearly confirm which disbursements carry VAT in our formal quotation or as we advise you to incur them.

Below we detail what services are covered in our standard fee.

If, at any stage, our fees change, we will notify you and discuss the reason for any changes. This would typically occur if you change your instructions or your case involves an unforeseen complexity.

Our average fees assume that:

  1. This is a standard transaction and that no unforeseen matters arise including for example (but not limited to) a defect in title which requires remedying prior to completion or the preparation of additional documents ancillary to the main transaction.
  2. For Leasehold matters, this is the assignment of an existing lease and is not the grant of a new lease.
  3. The transaction is concluded in a timely manner and no unforeseen complication arise.
  4. All parties to the transaction are co-operative and there is no unreasonable delay from third parties providing documentation.
  5. No indemnity policies are required. Additional disbursements may apply if indemnity policies are required.

Disbursements and Other Costs

Disbursements are costs related to your matter that are payable to third parties, such as Land Registry fees. We handle the payment of the disbursements on your behalf to ensure a smoother process.

You will be provided with a full list of disbursements in our formal quotation.  If you need to incur any further disbursements during your case, you will be notified in advance of the reason and the amount.

Typical disbursements and other costs that may apply in you matter will include: –

Typical Property Search Fees

Search fees vary from case to case depending on the local authority. We will advise you which searches you need for your transaction and the cost of each search. Our average fee for a standard property search pack is £250.00 + VAT (£300.00 inc. VAT) Typical local searches include:

  • Local land charges search;
  • Enquiries of the local authority;
  • Environment search;
  • Planning Search;
  • Chancel repair liability indemnity; and
  • Water and Drainage search

Other official local searches may be required by your lender and your conveyancer will use their local knowledge to confirm which local searches you will need. A standard local authority search will reveal whether any legal restrictions or obligations affect the property. These include tree preservation orders, smoke control orders, flood searches as well as the property’s planning and building enforcement history. Other various searches maybe required depending on your location and can reveal whether the property is in the vicinity of any planned major infrastructure projects.

We will advise you which searches you need for your transaction and the cost of each search.

Anticipated disbursements for a leasehold purchase 

There may be further disbursements for a Leasehold purchase or the purchase of a freehold property where there is a Management Company which if chargeable is set out in the Lease or Transfer and usually paid to the Landlord or Management Company.

These can include: 

  • Notice of Transfer fee – This fee, if chargeable, is set out in the lease and is often between £0 – £250 + VAT (£0 – £300 Inc. VAT)
  • Notice of Charge fee – If the property is to be mortgaged.  This fee is set out in the lease and is often between £0 – £250+ VAT (£0 – £300 Inc. VAT)
  • Deed of Covenant fee – This fee is provided by the management company for the property and can be difficult to estimate but is often between £0 and £250. + VAT (£0 – £300 Inc. VAT)
  • Certificate of Compliance fee – To be confirmed upon receipt of the lease as can range between £0 and £250. + VAT (£0 – £300 Inc. VAT)

These fees are set by the management company / freeholder and can vary from property to property. They can, on occasion, be significantly more than the ranges given above and VAT may be charged. We can give you an accurate figure once we have sight of your specific documents.

You should also be aware that ground rent and service charge are likely to apply throughout your ownership of the property.

Stamp Duty or Land Tax (on purchase)

This amount payable depends on the purchase price of your property. You can calculate the amount you will need to pay by using HMRC’s website.

How long will my property purchase take?

How long it will take from your offer being accepted until you can move in to your house will depend on a number of factors. The average process takes between 12-16 weeks. It can be quicker or slower, depending on the parties in the chain.

If you are a first time buyer, purchasing a new build property with a mortgage in principle however, this would be dependent on the stage of the build and when this has been signed off by the building regulation inspector, the developers can provide an indication of this when the plot is reserved but could take anything up to a year.

If you are buying a leasehold property that requires an extension of the lease, this can take between 4 and 8 months. In such, a situation additional charges would apply.

Stages of the Process

The precise stages involved in the purchase of a residential property vary according to the circumstances. We have set out the key stages of a standard transaction: –

  • Taking your instructions and giving you initial advice.
  • Undertaking regulatory checks.
  • Checking that finances are in place to fund the purchase and contact lender’s solicitors if needed.
  • Receiving and advising on contract documents.
  • Carrying out and advising on searches.
  • Obtaining of further planning documentation, if required.
  • Making any necessary enquiries of seller’s solicitor.
  • Giving you advice on all documents and information received.
  • For Leasehold properties – obtaining and advising on the Management Pack, thee Lease and identifying transfer fees.
  • Advising you on joint or shared ownership.
  • Going through conditions of any mortgage offer if appropriate.
  • Sending final contract to you for signature.
  • Agreeing completion date (date from which you own the property).
  • Exchanging contracts and notifying you that this has happened.
  • Arranging for all monies needed to be received from your lender (if applicable) and you.
  • Completing the purchase and notifying the relevant parties.
  • Dealing with payment of Stamp Duty/Land Tax.
  • Dealing with the application for registration at Land Registry.

Other Factors

Other Factors to consider which may affect your Legal Fees and disbursements are:

  • Value of the property.
  • First-time buyer.
  • New build.
  • First registration of title.
  • In purchase cases, whether primary residence, buy to let or second/holiday home.
  • Multiple owners.
  • Shared ownership scheme.
  • Using a help to buy scheme, and whether it is an equity loan or ISA.
  • Purchase under right to buy.
  • Purchase at auction.
  • Property has been repossessed.

These fees vary from property to property and can on occasion, be significantly more than the ranges given above. We can give you an accurate figure once we have sight of your specific documents.

Questions

If you have any questions relating to our services and our fees, please contact us on 01420 558 296 or email: enquiries@bookersandbolton.co.uk

Who Will Carry Out The Work?

All legal work will only be carried out by our experienced lawyers and over-seen by our Head of Property and the Senior Partner

Our dedicated and experienced support team carry out all administrative tasks so that your lawyer can concentrate on getting the legal work done.

You will receive a full list of who is responsible for your matter upon instruction.  We are happy to discuss this with you and for you to meet the team at any point.