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At present, this is a crucial question that is at the forefront of many first-time buyers' minds.
According to Today's Conveyancer, new registrations for home services, including conveyancing, surveying and removals, were 73% higher in the first week of January 2024 than in the same period last year.
However, while getting caught up in the January flurry of activity is tempting, you cannot rush to buy your first home.
Take your time and ensure that you have noted our residential property solicitors' key considerations outlined below.
Shall I buy a freehold or a leasehold property?
Ultimately, it is your decision. However, it is important to recognise that they are distinctively different types of property.
To make an informed decision, it is good to view both.
Flats will almost always have a leasehold title, but houses could be either freehold or leasehold.
If you purchase a freehold interest in a property you will own the land and building upon it forever.
In contrast, if you buy a leasehold interest you will be allowed to use and possess the property, or part of it, for an agreed period of time known as the “term”.
The freeholder of the property will be the landlord and you will be the tenant under the lease of the property.
If you purchase a leasehold flat, you will not be responsible for all costs relating to the property.
Instead, you will pay service charges and ground rent to the freeholder or a management company for maintenance of the common parts and insurance.
When viewing the property, it is prudent to ask what the current charges are.
If you purchase a leasehold house, there could also be a service charge and ground rent payable.
Again, you should ask for details when you first view the property and what the remaining 'Term' is on any Lease.
How shall I own my property?
This is not a concern if you are buying in your sole name. However, if there is more than one purchaser, it is important to consider your response to this question carefully.
There are three options:
(1) Tenants in common (fixed shares) – This will enable you to specify the shares of each co-owner, for example, 50% each. Upon the death of the first co-owner, their share will not automatically pass to the survivor but will pass in accordance with the wishes outlined in their Will. If one is not in place, it will pass to the beneficiaries in line with the intestacy rules. When the co-owners decide to sell the property, they will receive their specified share of the sale proceeds.
(2) Tenants in common (variable shares according to your contributions over time).
(3) Joint tenancy – In this instance, the 'right of survivorship' will apply. This means that, upon the death of one co-owner, their share will automatically pass to the survivor regardless of any Will in place. Each owner will own the entire property rather than a fractional share (as outlined above).
Your solicitor will ensure that your chosen option is recorded in the Transfer deed.
Ultimately, you need to ensure that your method of co-ownership accurately reflects your intentions in relation to the ownership of your property.
If you need a solicitor to guide you through the first-time buyer process, please do not hesitate to contact us.
We pride ourselves on providing legal advice tailored to your specific circumstances and helping you to obtain the keys to your first home.