Home reports in Scotland
When you're buying a home in Scotland the seller will need to provide any potential buyers with a home report on their property. The only exceptions are new-builds and buildings that have recently been converted into residential properties.
The home report consists of a single survey, an energy report and a property questionnaire.
The single survey contains a valuation and an assessment of the property's condition (including the roof, external walls and plumbing). You may want to consider getting a more detailed building survey done if the property is older or of a non-standard construction.
The energy report will give the property an energy efficiency rating and assess its environmental impact by looking at carbon dioxide emissions.
Completed by the seller, the property questionnaire will contain details such as whether the property has ever flooded or been treated for wood rot, as well as useful pieces of information such as what the parking arrangements are and which council tax band the home falls into.
Which? Mortgage Advisers can find the best lenders and deals for your personal situation.
Making an offer on a Scottish property
Properties in Scotland are usually marketed and sold by solicitors, rather than estate agents. They are either advertised at a fixed price or for 'offers around' or 'offers over' a certain price.
When a property is advertised for 'offers around' or 'offers over', a closing date will be set and prospective purchasers will need to submit sealed bids before that date.
Your solicitor (see below) will work with you to prepare your offer and pass it on to the seller's solicitor on your behalf. As well as how much you're willing to pay for the property, your offer should include a proposed 'date of entry' - ie when you'll pay and get the keys - and other terms and conditions relating to the purchase.
Once the offers are in, the seller will then choose the offer they want to accept.
No money is paid at this stage unless it’s a new-build property, in which case a deposit may be required.
Conveyancing for buyers in Scotland
When buying a home in Scotland you'll need to instruct a solicitor very early on in the process. Once you've seen a property you're interested in buying, your solicitor should:
- Explain the home report to you
- Check that any alterations have been made with the necessary planning permission and building control approval
- Put together your offer with you
- Submit your offer to the seller's solicitor
Once the offers are in, the seller will choose the offer they want to accept. This doesn’t have to be the highest.
If your bid is successful, your solicitor will confirm your mortgage with the lender, agree an entry date and deal with legal enquiries about the property.
Concluding the missives
They will also agree the contract with the seller’s solicitor. This is known as ‘concluding the missives’, and it's legally binding for both the seller and buyer.
At this point, the solicitor will undertake the conveyancing process to transfer the ownership of the property.
On the date of entry that’s agreed in the contract, you'll pay the whole of the purchase price in exchange for the keys to the property. This point is known as 'settlement'.
Your solicitor will pay any LBTT that is due, register the change of ownership with the Registers of Scotland, and lodge title deeds with your mortgage lender (you'll get a copy too).
- For a more detailed guide to the process, see our separate guide to conveyancing for buyers in Scotland
Land and Buildings Transaction Tax
Land and Buildings Transaction Tax (LBTT) is the Scottish equivalent of stamp duty and is charged on the following:
- First-time buyers: properties costing £175,000+
- Home movers: properties costing £145,000+
- Buy-to-let or second home buyers: properties costing £40,000+
To find out the rates and work out how much you'll pay, use our LBTT calculator.
Buying a tenement property
Technically speaking, a tenement is a building or part of a building containing two or more flats that are separated horizontally and designed to have separate ownership.
This includes houses converted into flats, high-rise blocks, and both traditional and modern buildings. Tenements can also be office blocks, although most are residential.
How do tenement properties work?
More than a quarter of the housing in Scotland consists of tenements.
If you’re buying a flat in a tenement property, you will own your flat and a share of the tenement’s common parts, and a share of the land upon which the tenement is built.
The title deeds to each flat should set out who owns what. If the deeds don’t do this, certain rules will apply - for example, the owner of the top-floor flat will own the roof space above it.
Talk to your solicitor to find out how it works for the property you're buying. It's important that you fully understand the setup.
Tenement maintenance costs
As a tenement flat owner you’re liable for a share of maintenance costs to common parts of the tenement.
Unless the repairs are essential, a majority of the flat owners must agree on whether they are needed, which can cause difficulties and delays.
What is a 'factor'?
Sometimes the titles provide for the appointment of a 'factor'.
This is a person or firm with the responsibility of managing and instructing repairs. If this isn't covered in the titles, the tenement owners may agree to appoint one.
Assuming the factor acts properly, the owners of all the flats will be liable for the costs of repairs.
Restrictions of use
In Scotland, most property titles have conditions that restrict their use. For example, there will usually be a condition specifying that a property won’t be used for commercial gains.
When a property is passed to a new owner, so too are these conditions. Your solicitor will inform you of all title conditions involved with the property you’re buying, normally prior to the date of entry but after the contract is concluded.
If you're unhappy with any of the title conditions, you can try asking the seller to try getting the conditions changed. However, this rarely happens and the title conditions must usually be accepted for the deal to go ahead.
Feuhold properties and feu duty
This complex system was abolished for most properties in November 2004, but check with your solicitor to make sure it doesn’t apply to your property.
Joint ownership of a Scottish property
If you want to buy a home with someone else, you have two options: joint ownership or common property. It's worth talking to your solicitor about what will work best for your situation before making a decision.
If you've bought a house under joint ownership and one of you dies, your share will automatically pass to the other person without any conveyancing expense.
Joint owners can sell or give away their share during their lifetime, but they can’t give it away in a will.
If a home is owned as 'common property', the owners can sell or give away their share during their lifetime or in a will.
This can be problematic if, for example, a couple has bought the property and then splits up. Your solicitor should explain all the consequences of these clauses before you decide to use one.
Help to Buy (Scotland)
This government scheme enables people to buy new-build homes with a deposit of 5%, government equity loan of 15% and mortgage of 80%.
Help to Buy is currently set to run until March 2021 in Scotland. To find out more about eligibility, how it works and the pros and cons, check out our guide to Help to Buy (Scotland).
How the Scottish property system differs from the rest of the UK
The property-buying process in Scotland is generally quicker and less likely to fall through than it can be in the rest of the UK, excluding Northern Ireland.
In fact, research by TwentyCi found that, in 2018, 10.4% of transactions fell through in Scotland after an offer had been accepted, compared to 21.8% in England, 22.9% in Wales, and 9.6% in Northern Ireland.
There are a number of reasons for this:
- Preparing a home report costs money, therefore it's more likely that the vendor is serious about selling
- The home report means that buyers are better informed about a property's condition and value at the point of making an offer, so there's less potential for them to back out later
- Gazumping - when another buyer makes a higher offer after yours has been accepted - is rare because properties are usually withdrawn from the market once a price has been agreed. Solicitors are also not allowed to continue to represent a seller if they choose to go with a different buyer, meaning they don't encourage the practice.
It will generally take four to eight weeks to buy a property in Scotland, while it's more likely to take eight to 12 weeks in England, Northern Ireland or Wales.