How to buy property in UK in 2019: 3 steps
Buying property is no small ordeal; it is a big decision and an even bigger investment. But, buying property is a worthwhile long-term investment because it is a personal asset. Whether you are buying property in a new neighbourhood to relocate or a fixer-upper property which you are going to renovate to sell for a profit or you’re buying property to lease out, the steps to buy property remain the same. So, it doesn’t matter if you’re looking at properties for sale in Dunstable or you’re looking at properties in the heart of London, these are the 3 basic steps you need to follow to buy investible property at the right time in the UK in 2019!
1. Get pre-qualified and then pre-approved
To get pre-qualified means you know how much the bank is willing to lend to you, and that means you know what price range to look at. Getting pre-qualified is fairly simple, you just need to provide some financial documents like income statements, savings, investments etc. Once you are pre-qualified, you can then get pre-approved. To clarify, pre-approval means providing the bank with details like credit reports, employment history, income statements depending on which the bank qualifies you for the maximum amount that you can borrow and the applicable interest rate. Do make sure that you work on improving your credit score at least 6 months to a year before you apply for pre-approval; the better your credit score, the higher the chances of pre-approval and the better the rate of interest.
2. Start looking for potential property
Once pre-approved and pre-qualified, you have a fair idea of how much you’re willing to spend on buying a new property. Make sure to look at a property which is very much within that price range! It is always recommended to hire an estate agent since they have a better idea of the available properties on the market, the market price of various properties and they can help you out with the legalities and paperwork. Your real estate agent will also probably help you get a good deal for the property, and that is something very important. Don’t worry about paying the estate agent – they usually take a commission from the seller!
3. Make an offer they can’t refuse
Once you have finalized a property, make sure that everything is actually in order. First, you should thoroughly inspect the house yourself to see if everything is working and in pristine condition. Yes, you might have to make some renovations and changes, but overall everything should be working. Then, you must get a professional home inspection – this will help you find out if there is anything seriously wrong with the house, like mold, structural damage or even termites. Following that, you should get the home appraised to know the actual value of the property. Based on this, you and your estate agent can negotiate a final deal with the seller. If everything is in order, you can go ahead and make an offer to the seller.
As simple as it sounds, buying a house requires a lot of investment and involves a lot of paperwork. It is very important to actually do your research before you decide to buy a house. That includes:
- Financial research which means gathering information about government buying schemes like Equity Loan, Help to Buy etc.
- Mortgage research which means speaking to different banks and lenders to find out about their mortgage rates and interest rates.
- Neighbourhood research which means choosing a good neighbourhood, figuring out distances to work/school, understanding the tax laws of different areas etc.
While you are setting your finances aside, don’t forget about additional payments or hidden payments like land tax, cost of home inspection and appraisal, stamp duty, cost of parking space, renovation and other such costs.