Buying a home is a complex and often lengthy process - but if you can get your head around the basics of how it works, you’re less likely to be taken by surprise along the way and your home-buying experience will be easier.
This page takes you briefly through each step you’re likely to take when buying a home, and you can find more details by following the links within each section.
The home-buying process works differently in Scotland. You can jump to the section on the Scottish property system for more information.
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You’ll usually need to save a deposit of at least 5% of the price of the property you want to buy. For example, if you wanted to buy a house worth £200,000 with a 95% mortgage , you would put down £10,000 of your own money and borrow the remaining £190,000.
It’s often worth saving more if you can wait longer, as a bigger deposit means you can apply for mortgage deals with lower interest rates.
If you're a first-time buyer, saving into a lifetime Isa will entitle you to a 25% top-up from the government (up to £1,000 a year) on your savings.
Shared ownership - you buy a 25%-75% share in a property, and pay rent on the rest.
Help from parents - even if your family can't provide cash toward your deposit, some mortgage lenders will allow your parents to use their property or savings as a guarantee for your mortgage.
First Homes scheme - first-time buyers with a household income of £80,000 or less (£90,000 or less in Greater London) can get a discount of at least 30% on some new-build homes.
Right to Buy - council tenants can buy their home at a discount. If you've lived in a council house for at least three years, you can benefit from a 35% Right to Buy discount.
The amount a mortgage provider will lend you will depend on various things, including the size of your deposit, your income and credit score . If you’re buying a property with other people, the lender will also take their finances into account.
Generally speaking, banks will allow you to borrow a maximum of around four-and-a-half times your annual salary, but this varies depending on the individual lender, your financial circumstances and the size of your deposit.
Remember to budget for the additional costs of buying a property , such as conveyancing, surveys, and - depending on the cost of the property and whether you’re a first-time buyer - stamp duty ( LTT in Wales, LBTT in Scotland).
If you’re exploring towns or neighbourhoods you haven’t lived in before, it can be worth spending a night or two in the area to check out the commute, shops, restaurants and general atmosphere.
Even if you’ve lived in the town all your life, it’s important to do some research on the area you want to buy in before signing on the dotted line.
Things to look into include:
A mortgage agreement in principle (AIP) is a confirmation from a mortgage lender that they would, in principle, be willing to lend you a certain amount. It can also be known as a decision in principle (DIP).
Having an AIP can make you a more attractive buyer, as it shows the seller and their estate agent that you will be able to secure the amount of money you need to buy the property.
Once you’ve chosen the area (or areas) where you’re interested in buying a home, register with local estate agents. Registering is free and won’t create any obligation on your part.
Keeping in touch with local estate agents could increase your chances of finding your ideal home, as agents sometimes contact registered buyers before listing a property online.
You’ll inevitably spend plenty of time browsing property portals such as Rightmove and Zoopla, but it’s important to view properties in person, as well as online.
Viewing homes in real life will give you a deeper understanding of their potential (or lack of it) and you’ll be able to gauge whether they give you that indescribable ‘feeling’ that you can't really get from a screen.
When you find somewhere you like, it’s worth viewing it more than once, and at different times of the day, as you’ll be more likely to notice any potential problems.
Deciding exactly how much to offer can be tricky.
It’s quite common to offer below the asking price, but it all depends on the individual property. If other people are interested or it's a particularly hot market, you may need to offer the asking price or more.
Looking at how much other similar properties in the same neighbourhood have recently sold for will help you work out how much the property is worth. You can find this information on websites such as Zoopla
Once you’ve decided how much to offer, you can tell the estate agent over the phone or in person, but it’s worth putting it in writing too.
Mention any points that stand in your favour - for example, if you’re a chain-free first-time buyer - and say that your offer is subject to a survey and the property being taken off the market. This can reduce the chances that you'll be gazumped.
You’ll need to think about what type of mortgage you want to apply for.
Fixed-rate mortgages are by far the most common, with most buyers choosing to lock in their rate for two or five years. But tracker mortgages - where the interest rate is variable - are another option.
You'll also need to consider your mortgage term. In the not-so-distant past, most people took out 25-year terms, but terms of 30, 35 and 40 years have become increasingly common for first-time buyers battling rising house prices.
You can see how much your monthly payments would cost based on different interest rates, loan amounts and mortgage terms using our mortgage repayments calculator .
A life insurance plan can offer peace of mind that your loved ones won't be left out of pocket if you fall ill or die before repaying your mortgage. Find answers in what is life insurance? or see the best life insurance companies .
Find out more and get fee-free advice on life insurance using the service provided by LifeSearch. Discover more
Conveyancing is the legal process that takes place after your offer is accepted.
In England and Wales, this includes carrying out searches, drawing up and checking contracts, dealing with the Land Registry and paying any stamp duty.
You can use a conveyancer - who might not be a qualified solicitor but will definitely specialise in property - or a solicitor, who you should check has recent experience in property law.
House surveys help to assess the condition of the building and detect structural problems.
Although a survey is optional, it’s better to be aware of any issues before buying so you can make an informed decision on how much to offer and budget for any repair work required.
A survey could also enable you to either negotiate the purchase price down, or ask the seller to fix any problems.
Surveyors registered with the Royal Institution of Chartered Surveyors (Rics) provide three ‘levels’ of survey, while those registered with the Residential Property Surveyors Association (RPSA) offer two levels. The cost will depend on the location, size and type of property.
Don’t confuse the valuation survey conducted by your mortgage lender with a house survey - they are two different things and you should always have your own survey done independently.
If you don’t have a lot of furniture to move into your new property, you could hire a removal van yourself.
But if you have a lot to move, removal companies can help make the process easier - Which? Trusted Traders can help you find a reliable firm near you.
Removal company costs will depend on the number of items you need to move and the distance to your new property, among other things.
Once you’ve found one or two firms you like, check their availability before agreeing a completion date with the seller (see below) so you're able to move on the date you set.
It’s vital that you have buildings insurance in place on your new home from the day you exchange contracts - in fact, most mortgage providers will make this a condition of lending.
This is because you are legally bound to buy the property from the moment contracts are exchanged, so if the building were to be flooded or burn down before the day of completion (see below) and you weren’t insured, you wouldn’t be covered.
If you’re buying a new-build property, the insurance doesn’t need to come into effect until the day of completion.
Check Which? insurance ratings and compare deals using the service provided by Confused.com
The exchange of contracts happens when the buyer's and seller’s legal representatives swap signed contracts, and the buyer pays the deposit.
Before the exchange of contracts, you’ll need to have several things prepared in advance, such as a written mortgage offer, an agreed completion date and buildings insurance in place from the day of exchange (or from completion if you're buying a new-build).
After you’ve exchanged contracts you can breathe a sigh of relief, as the agreement for you to buy the property is now legally binding. The chances of anything falling through from this moment are extremely low.
Your conveyancer will lodge an interest in the property, enabling you to pay the seller, and apply to the Land Registry to transfer the deeds to your name.
Completion often takes place around two weeks after exchange, but this is flexible and you can agree a convenient date with the seller.
On completion day, the money will be transferred to the seller and you can then collect the keys from the estate agent and move into your new home.
Next comes the much more enjoyable task of starting to furnish and decorate the property to your taste - and maybe even taking a moment to simply relax. You’ll have earned it!
If you're buying a home in Scotland, the process works slightly differently.
See below for a step-by-step guide.
Once you've found a property you want to make an offer on, get your finances in place.
In most instances, the first step is to get an agreement in principle from a mortgage lender.
When searching for a home, note that properties listed for sale in Scotland must have a Home Report
This report will include the following:
When buying a home in Scotland, you'll need to appoint a property solicitor (conveyancing solicitor) early in the homebuying process.
Your conveyancer will check your finances, explain the property's Home Report to you, check any planning permission issues, and put together your offer.
Rather than setting a high asking price and negotiating downwards, sellers in Scotland usually advertise properties as 'offers around' or 'offers over' a certain figure.
Some properties are available for a fixed price, but this is less common.
In many cases, a deadline for making an offer will be set and you'll need to submit a sealed bid in advance of that date.
Your solicitor must send your offer in writing to the seller's solicitor. Only offers submitted via a solicitor will be considered.
The offer will include a proposed 'date of entry' on which you plan to move in and any specific conditions.
The seller doesn't have to accept the highest offer. For example, they may prioritise a chain-free buyer over the highest bidder.
If your offer is accepted, your solicitor will negotiate the conditions (' missiv es
') with the seller's solicitor.
At this point, the estate agent should removed the property from the market.
Your solicitor will now undertake the required legal aspects of the purchase. This includes:
At this point, you should formally apply for your mortgage.
If your mortgage offer doesn't proceed, the property can still be put back on to the market.
The solicitors will finalise the contract ('concluding missives') and the purchase will become legally binding on the completion date (the ' settlement
On the agreed settlement date, the seller will be paid the full purchase price and your solicitor will pay any required Land and Buildings Transaction Tax (LBTT) on your behalf.
Finally, the change of ownership will be recorded at the Registers of Scotland.
The process of buying a new-build home works differently. Most properties are sold at a fixed price, often before the home has been built (known as buying off-plan )
Instead of you making an offer, the builder makes an offer to sell the property to you. This will come with a list of conditions.
You'll need to arrange a mortgage before accepting the offer. Once you've accepted the offer, it will become a legally binding contract.
Tenement properties in Scotland include flats in converted houses and high-rise blocks.
If you buy a flat in a tenement property, you'll own the flat, a share of the common areas and a share of the land upon which the property is built.
Tenement properties come with title conditions that apply to all flats - for example, not permitting commercial use.
Generally speaking, flat owners share the cost of repairs to the building or communal areas. Sometimes a 'factor' is appointed - this is a person responsible for managing and instructing repairs.
If you're thinking of buying a flat in a tenement building, ensure you take specialist advice from a property solicitor.
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