How to Buy a House in London

Buying a house in the London is a drawn-out affair.

Buying a house in London is expensive. Property prices in England's capital are far higher than in other areas of the country. Buying a house in the London is also a drawn-out affair, taking 12 weeks, on average, from deciding upon a house to exchanging contracts. There is much legality involved, and you should be prepared to haggle over the price you are willing to pay.

Instructions

1. Find a house. Register with estate agents in London and use online property websites such as RightMove. Areas of London such as Chelsea, Kensington and Knightsbridge are very expensive. Up-and-coming areas of London include Dalston, New Cross and Stratford, these areas being regenerated as part of the London 2012 Olympics. Use the Where's My Property map to get an idea of London house prices by region.

2. Contact banks and mortgage lenders to secure a mortgage. The main UK lenders include Barclays, Lloyds and HSBC, and the building society, Nationwide. Discuss what type of purchase you wish to make with your lender: leasehold or freehold. A freehold purchase means you own the house outright, a leasehold purchase buys you the right to live in a property, rather than ownership of the property itself. Many leases are granted on a 99-year term while some run for 999 years.

3. Get a survey and valuation done. It is important that you flag up any problems with the property early on.If there is a major structural issue with the property, you may be able to get a reduction in the asking price, to allow for repairs you will need to make. If the problems are insurmountable, walk away. Prices for a full structural survey in London range from 100 pounds for a 50,000 pound flat to 250 pounds for a 200,000 pound property. Some UK mortgage lenders provide a free structural survey.

4. Make an offer. This will be done through the estate agents responsible for the property or, occasionally, directly with the owners of the house. Bid low to begin with as it is likely that your first offer will not be accepted. Typically, estate agents in London take between a 2 percent and 3.5 percent commission on the sale of a home, so it is in their interest to drive the price as high as possible. Remember this and negotiate hard.

5. Hire a solicitor. Once your bid has been accepted, you will need a solicitor to take care of all the legal paperwork. It is possible to do this yourself, but the ramifications of making a mistake can be disastrous. Many mortgage lenders in the UK insist on a professional solicitor being hired.

6. Finalise your mortgage with the bank and, if everything is in order, exchange contracts with the homeowner. Both you and the homeowner need to sign the contract, legally binding both parties to the sale. A deposit, usually in the region of 10 percent of the asking price, must be paid to the seller.

References

• Where's My Property: London average
• Home: Buying

Resources

• RightMove: London