Buying a flat can be daunting, especially if it’s your first time. So, we’ve put together a handy guide of the things you should be thinking about. Follow it, and buying your flat should be a breeze. So, what’s first?
How much is it going to cost?
Failing to include everything that you’ll have to pay for when buying a flat is a common mistake, and one that can prove very costly. It’s not that people deliberately leave things off, many genuinely don’t know all the different things that need to be paid for or they just forget something. So, here’s a list of things you should think about:
Legal fees – an inescapable fact of buying a place. Expect to pay between £500-£800. Some lenders will pay some or all of these fees for you, but you may be better off finding your own solicitor and arranging for the work to be done yourself.
Stamp duty – This is only payable if your property is over £125,000. If it is, and you want to know how much stamp duty you’ll pay, our friends over at HMRC have a handy Stamp Duty Calculator.
Valuation fee – before the lender agrees to give you the money to buy your flat, they need to check that it actually exists and that it’s worth the price you’re being asked to pay. The price of the valuation will differ depending on the cost of the property and your lender (some lenders include them in the mortgage application or arrangement fee).
Mortgage arrangement fee – this is the fee your provider charges for all the paperwork required for setting up your mortgage. The cost can vary, but it’ll be around £1000. Your lender will often allow you to add it to the mortgage, so you may not actually need to pay it up front.
Surveys – This is another essential as it helps you identify any potential major issues with the property before the sale completes. You may have to pay for more than one survey if you’re interested in more than one property, so try to budget for two or three, just in case. There are three kinds of surveys you can choose from, condition report, homebuyers report and a buildings survey. Which one you take will depend on how much detail you want it to include and the age of the property, plus whether it is leasehold or share of freehold. What kind of house survey should I get? contains loads more useful information on this.
Moving costs – these can be from as little as £100, if you’re just hiring a van to throw a few things in. But, if you’ve got a family of four and a semi’s worth of furniture and stuff to move, you’re going to be looking more at about £1000.
Repairs and maintenance – keep some cash aside for the little bit and bobs that may need doing before you move in.
Other things – do you have your own furniture? What about carpets, do you have any of those? What will you sleep on? You’ll need to budget for these if you don’t already own them.
How long will it take?
Next, let’s look at how long it’s going to take.
Generally speaking, a house sale that progresses without any problems, will take approximately 10 weeks. That’s from the time you put in the offer to picking up the keys.
Get yourself a ‘mortgage in principle’ or ‘decision in principle’ (MIP or DIP) to speed up the process. This simply means that the mortgage provider has said they are prepared to give you the mortgage, if you can find a suitable property within a certain timeframe. Why do this? Well, having an MIP, along with a deposit, helps when you want to put in an offer on a property. It tells the seller of the property that, in principle, you have been approved for a mortgage already.
There’s no such thing as a silly question, particularly when they’re about one of the largest purchases you’ll ever make. So, don’t be afraid of asking about anything that might affect how you’d feel about living in the property. To get you started, here are some questions you may want to think about:
How many people have viewed or put in offers for the property?
When was the last time it was fitted with a new boiler, roof, wiring?
Why do the current owners want to move and are there any disputes with neighbours?
What’s included with the sale? (Many people have been caught out by owners who take everything, including removing the plug sockets from the walls!)
What council tax band and energy efficiency rating (EPC) does the property have?
Who will your neighbours be? (Bear in mind that you may have neighbours above and below you, as well as on either side.)
Is there a service charge and how much is it?
Is the flat is leasehold? If so, how much is the ground rent? And how long is left on the lease?
If you’re thinking of buying somewhere, you want to know what it’s like in the morning, in the afternoon and maybe later in the day too. Why? Because, it might be quiet for your first viewing at 10am, but when the local school chucks out at around 4ish, the whole street erupts into chaos. And, in the evenings it might be worth driving past, even if you can’t get a viewing, to see what the area is like around your potential new home after dark.
Whilst you are viewing, you should also take pictures of the flat. There should be no objection to this, but just ask the agent if it’s okay before you start snapping. Of course you may not need to do this if you’re only seeing one house, but imagine trying to remember what 10 different properties look like.
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Intelligent Lending Ltd (Credit Broker). Capital One is the exclusive lender.