Whether you’re buying your first home, or your second, the process is probably one of life’s most stressful events. Luckily, you’re not the only person to have taken their first step on the property ladder. Every year, thousands of people successfully buy and sell their homes in the UK. As a result, there’s a documented right and wrong way to do it.
Based on a combination of research and personal experience, we’ve created a comprehensive ‘How to buy a house’ guide, so you know exactly what to expect from your home purchase.
If you’re a first-time buyer, and you’re not selling your house at the same time, the process and steps should look very similar to this:
In this section, we take a look at the process of buying a house in close detail, from the moment the thought pops into your head, all the way to completion day.
First and foremost, you need to decide if you’re ready to buy a house. Owning a home is both a big commitment. Plus, the process of moving is a huge job, and it's best to set a chunk of the year aside in preparation.
While many of life's events are unpredictable, it pays to think ahead - that means, weddings, birthdays, anniversaries and holidays should not impede on your home purchase. If you're not ready for the twists and turns of moving, things will get difficult further down the line.
You need to decide if you’re ready to sell your house. A big indicator will be your mortgage tie-in period. If you can remortgage and move without incurring an early repayment charge, you’re ready.
You've probably started looking for prospective houses to move into. Can you afford the properties you like most?
If you can’t afford your dream property, it’s time to save, save, and save some more. While the end goal can feel like a lifetime away, it will all be worth it when you have a set of keys in your hand, and a house to your name.
There are lots of different ways you can save for your deposit. Taking lunch into the office or cycling to work are good ways to save money, especially if you live in expensive cities with extortionate commutes.
The best savings plans are made through financial advisors. Advisors examine all of your incomes, outgoings, and expenses to help create a saving strategy that works best for you. They will also help you work out what type of property is within your budget.
Property listings on property portals such as Rightmove, Zoopla, and OnTheMarket, are affixed with a price tag. This is the property's 'asking price' - the amount that the seller's estate agent expects the property to sell for. This is different to the 'purchase price' - the amount the property actually ends up selling for.
Unless you've sold your first property already, most people can't afford the full price on their own. That's where mortgages come in.
Mortgage lenders, like Nationwide and Halifax, can loan you the bulk value of the property (usually from 90 to 95% of the property's value). However, you will be required to pay the remaining figure upfront. This is called a deposit, and it's usually 5 - 10% of the remaining cost.
For more information on applying for a mortgage, check out our guide, ‘Will I get approved for a mortgage?’.
When you take out a mortgage, you are legally obligated to make good on monthly mortgage payments. What's more, every mortgage package comes with its own interest rate. The lower the interest rate, the quicker you'll be able to pay back your mortgage.
Can you afford the houses you like? A good way to assess this is by applying for a mortgage in principle or AIP (agreement in principle).
Before you start attending house viewings, you should hunt for the best mortgage deals. Hiring a mortgage broker is a good way to guarantee the best deal.
Brokers are specialists who use their extensive knowledge of available mortgages to help you find the best one. Usually, you can lock in mortgage rate offers for three months. This means you can get an AIP for £500,000 and hunt for properties within this budget. Also, if for whatever reason, your application is rejected, even after an AIP, a mortgage broker can help you find the next, best option.
Once you know how much you can afford, look for areas that match the type of property you want, and what you can afford to buy.
The area you move to will likely be somewhere you spend a large portion of your life. That means finding a location you like is super important.
To get started, you should try and research the following factors:
For most people, this is easily the most enjoyable task. You can use Zoopla and Rightmove to locate ideal properties. We recommend making a shortlist of the best properties in your chosen area. A shortlist will help you keep track of the properties that make you tick. If one becomes unavailable, you can cross it off the list.
Once you have a shortlist, it's a good idea to get a mortgage agreement in principle.
A mortgage agreement in principle (AIP) is essentially a preliminary agreement from your mortgage lender to lend you the money you need. It's not an official mortgage agreement, but it does give an indication of whether you’ll have enough money to purchase the property you want.
You can use an AIP as a means to demonstrate your value as a buyer to sellers. If you're selling a house, you're much more likely to choose a buyer who can prove they can afford the property, than someone who can’t provide any evidence at all. If you're a first time buyer, this will further boost your chances, as you aren't attached to a property chain.
During an AIP application, the lender will run a soft check on your credit report. In a real mortgage application, they run a hard check, which leaves a ‘footprint’ on your report. Too many footprints imply that you've frequently applied for credit, which is a bad sign to any mortgage lender. That’s why it’s a good idea to get an AIP first, so you can get an idea of whether or not your real mortgage application will be accepted.
You can also register interest with local estate agents in the area. If you update them on what you’re looking for, they can give you first dibs on properties they haven't listed yet.
You should always try and see a property in person before you put an offer in. Photos are never enough to go on, especially the ones that estate agents take to advertise the best features of properties. That’s why a big part of finding your dream home is attending house viewings.
When you go and view a house, you should make a note of the following:
These will help you decide how viable the property is for your future plans.
It’s normal for people to view the same house two or three times. Multiple viewings, especially at different times (afternoon and evening), will provide a new perspective of the property.
For more information on what to look for during viewings, check out our free checklist.
Once you've found a property you like most, it’s time to make an offer.
Remember: Be wary of gazumping and gazanging. Gazumping is where the vendor accepts a higher offer despite a verbal agreement having been made with the original buyer. Gazanging, on the other hand, is when the vendor pulls out of an offer and decides to stay put, despite a verbal agreement with a buyer.
Knowing how to negotiate the right offer is an art form, but you can do it skillfully if you consider all the possible factors affecting the seller.
Offering more than the asking price is a tactic best saved for hot properties that have already received offers.
You should offer more if:
This tactic has its pros and cons. On the one hand, you might end up paying less for the property of your dreams. On the other hand, you might lose your chance to take the property off the market. Usually, the best properties are snapped up pretty quickly. If you’re dead certain on a house, you might be better off offering more.
Wondering if you can trust an estate agent’s word in the offer process? Check out our blog ‘Can estate agents lie about offers?’.
During the offer process, you can also negotiate on ‘what’s included’ within the final sale. Fixtures and fittings are a good place to start. Notice anything broken or off in the house viewing? Negotiate to have it included in the final price. Did you see any white goods or other appliances in your viewing? It's worth checking if you can get them included in the final sale price.
For more information, check out the blog on ‘How to make an offer on a house’.
Congratulations on having your offer accepted! Make sure that you get the home sellers to take their property off the market. You don’t want to be gazumped. Insisting they remove the property from portals is a good way to follow up on this.
Unfortunately, this isn’t the time to get complacent. A lot can happen between now and completion day. Your next task is to apply for a mortgage.
Remember: The bank will be checking that the mortgage requested matches the value of the property. They will also check if your employment situation is stable. If things have changed, you could end up with a different interest rate or offer than your initial AIP.
Every mortgage application requires a hard check on your credit report, which will leave a footprint. Footprints are a signal to other lenders that you've recently had a hard credit check. While one isn’t enough to do any damage, several hard checks will imply that you've recently taken out several loans, or have been rejected on several applications. Ultimately, this will suggest you are an untrustworthy investment.
Your mortgage lender will send a property expert round to evaluate your new home. The expert will verify whether the property is truly worth the final sale price.
If your offer is rejected, even after an AIP, you need to act fast. Our blog can help you with the next steps. If there are any issues, speak to your mortgage broker about the best course of action.
Should all go well, your mortgage application will be accepted without issue.
The conveyancing process plays a crucial role in property transactions. Conveyancers handle contracts and the completion of sale. They also take care of the transfer of payment, as well as ensuring all necessary bills are paid on your behalf.
This makes choosing the right conveyancer a big decision - but don’t worry, it’s fairly easy to work out how to pick one with our key points:
If you want a rough idea of how long the conveyancing process should take, check out our free Conveyancing Time Calculator for an estimate.
House surveys identify the condition of your new home. They are an important step before finalising a property purchase. The structural integrity of your new home should never be in question.
Remember: A mortgage valuation is not the same as a property survey. Most mortgage valuations are ‘drive bys’, where the valuer drives past the property and makes an estimate from the car window. Don’t take this as confirmation that your property is structurally sound.
There are several types of surveys available. Finding the one that’s right for you depends on the type of property you’re buying.
A snagging survey is primarily designed for new build properties. According to NationWide, these are homes built, converted or refurbished in the last two years. In a snagging survey, surveyors identify unfinished bits and defects. With these issues highlighted, you can push the developer to address them. These surveys cost from £300 to £600.
To find if your home qualifies for a snagging survey, head over to our blog, 'Snagging survey: Everything you need to know’.
Recommended for properties less than 100 years old, homebuyers reports are non-intrusive and identify ‘surface-level’ issues. They are, however, comprehensive, which means they usually take from two to four hours to complete.
Once the report is complete, you will receive specific advice on any property defects that affect your new home’s value, including the estimated cost of repairs and ongoing maintenance. Any major problems will swiftly be identified
If you own a particularly old or structurally unique property, a full structural survey is your best option. Intrusive and comprehensive, these surveys require a full investigation into all the nooks and crannies of the house. Surveyors will lift up floorboards and even drill small holes into the walls. Full structural surveys help you get a full picture of the property’s structural integrity. When the survey is done, you’ll get a detailed report of everything, including any problems that impact the property’s safety and value.
For more information on the different types of house surveys available, check out our blog, ‘House survey: costs, types, and how to find a good surveyor’.
It's time to get in touch with other members of the property ladder and negotiate a completion date.
Finding a date that works for everyone can be difficult, but it's best to be pragmatic about these things. It’s likely they’ll have dates they need to work around.
Remember: If you’re selling a property at the same time as buying one, you’ll need to make sure your completion date is agreeable with your buyers.
Before the exchange of contracts can take place, you need to deliver the deposit to your conveyancer. Once delivered, your conveyancer will transfer the money to your mortgage lender. This will allow for the safe transfer of mortgage funds on completion day.
An exchange of contracts is the moment a property purchase becomes legally binding. Hereafter, any attempt to forgo the transaction will result in penalties. It’s imperative that you’re both happy and certain before you go into the exchange.
You don’t really have to do anything during an exchange of contracts. This is a job for your conveyancer.
During the exchange, your conveyancer will ring the solicitor of every other party in the property chain to confirm they are ready for the transaction to progress to completion. During this process, the completion date is set in stone.
For more information, check out our complete guide to ‘Exchange and completion’. It provides a detailed outline of the entire exchanging contracts and completion day process.
Acquiring buildings insurance is essential before you move into your new home. This insurance covers the costs of damages and losses sustained from fire, flooding, earthquakes, thefts and attempted vandalism. It’s not a legal requirement, but it’s nearly always required by your mortgage lender.
Please note that buildings insurance doesn’t cover:
Before completion day, you will need a statement from your conveyancer. A completion statement will detail everything you need to pay on the big day, including:
You should aim to book a removal company at least two weeks before moving day. Most removal companies ask for a deposit. Without one, your booking could end up forfeited for another client.
Removal rates vary based on a number of factors:
Local movers are usually charged by the hour, while cross-country movers can expect to pay a fixed rate.
Your conveyancer will need to carry out additional searches before completion day. They need to ensure the seller still owns the property and that you haven’t been made bankrupt.
Your conveyancer will also prepare the deed of transfer. This is the paperwork that officially transfers the property and its titles to your name. You’ll need a witness to oversee the signing. Sometimes you don’t need to sign the transfer deed. If you're curious, you can always double-check with your conveyancer.
Well done, you’ve finally made it.
Completion day, or moving day, is a humongous chore - but it’s all worth it in the end. For a comprehensive resource on how to prepare for moving day, see our ‘Moving house checklist’. For a more simplified version, here’s what's in store:
1. Your lender will transfer mortgage funds to your conveyancer
Your conveyancer will request the mortgage funds from your lender so that the payment has time to clear in their account. It's at this point your conveyancer receives the mortgage money you've agreed to borrow.
2. Your conveyancer will then pay for the house
Your conveyancer will then send the full payment to the seller's conveyancer. They will receive both the title deeds and proof that the seller's mortgage has been cleared (this means their bank no longer has a claim on the property).
3. You’re ready to pick up your keys and move in
It’s time to pick up your house keys from the agreed person (usually the seller’s estate agent or conveyancer), and move into your new home.
Stamp Duty Land Tax is a government tax on purchasing lands and property. It’s a proportional tax, which means it increases with the amount of money you spend on your new home.
SDLT returns must be paid within 14 days of completion day. You can use the government Stamp Duty Calculator to work out how much tax you’ll need to pay. Your solicitor will take care of transferring your returns.
Your conveyancer will register your information with the Land Registry. As part of their disbursements, conveyancers usually charge from £200 to £300 for this , but it all depends on the price of your property.
...And that is pretty much that! Your conveyancer will forward your title deeds to your mortgage lender (or you if you’re lucky enough to be mortgage-free).
It’s time to put your feet up, pop open the champagne and enjoy your new home.
It takes roughly 24 weeks to go from looking for a house to completing
|Saving for a deposit||10 years||The average person takes 10 years to save for a deposit.|
|Getting an AIP||1 day||An agreement in principle generally takes 24 hours to approve, and is valid for up to 90 days.|
|Viewing houses||3 months||As of 2021, it’s currently taking 3 months to find the right house in the UK.|
|Making an offer||1-2 weeks||Making an offer typically takes 2-3 days of back and forth, but sometimes this can last up to 2 weeks.|
|Accepting an offer||1-2 days||Sellers tend to take an average of 48 hours to accept an offer.|
|Mortgage application and approval||4-6 weeks||Mortgage applications can take a while to approve due to both demand, and the extensive checks underwriters perform on your credit report.|
|Property survey||2-8 hours||Your conveyancer will order several searches of the property. In the meantime, you should order a property survey of some sort. These searches and surveys usually take 2-8 hours to complete, but the entire process could take up to 2 weeks in total.|
|Exchange of contracts||1 day||An exchange of contracts is usually completed within a single day. On rare occasions, an exchange might take longer. This is usually due to a fault further up the property chain.|
|Exchange to completion||1-4 weeks||During this period, your conveyancer will conduct final searches of the property. They will also draw mortgage funds for completion day. You might also need to sign a completion statement or a transfer deed. In this period, you should research removal companies and get a quote for the big day.|
|Completion and beyond||2 weeks||After you’ve moved in, your conveyancer will arrange for any Stamp Duty to be paid (within 14 days). They will also register your ownership with the Land Registry and obtain title deeds.|
On average, the completion process for a new build is much faster than an ordinary home. You don’t have to negotiate on fixtures and fittings, and whether you can get a discount if a survey shows there’s work needed. However, new build projects can be subject to delays depending on how long into the construction process they are. This is especially true for part exchange homes.
For a house priced at £270,027 (UK national average according to Halifax), a first time buyer would need to save approximately £23,602.025 before buying a house. Meanwhile, second home buyers would need to save approximately £26,814.25.
On average, it takes 5 - 6 months to buy a house. You usually need at least 3 months to find the right house, and 2 - 3 months to close the transaction. This can take a lot longer depending on how much you have saved for a mortgage deposit, with most people saving for at least 10 years.
A mortgage deposit is usually 5 to 10% of the purchase price. With the average currently valued at £270,027 in the UK (October 2021), you would need at least £20252.025 (7.5%) for a deposit.
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