Relocating to Scotland? What to look out for when buying over the border

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Are you thinking of relocating over the border and buying a property in Scotland? A lot of people who relocate from England and Wales to Scotland are not aware of the differences in the conveyancing processes and legal systems between the two countries. There are several key aspects that differ between the two conveyancing systems that buyers relocating to Scotland should look out for.

Request and Read the Home Report

One of the biggest differences between the English conveyancing system and the Scottish system is the legal requirement of home reports. A home report is a set of documents including a valuation survey, an EPC and a history of the property that comprise a seller’s guide. This in-depth guide makes the transaction more transparent, as the buyer knows the value of the property, the upkeep cost and if any major work needs to be done to the property. The seller is required by law to give all interested buyers a copy of the home report nine days after they have requested a copy of the document.

All property owners relocating to Scotland should request and read all documents in-depth to get the best possible home report cost on their dream home.

The things to look out for in a home report is the condition of the features, how long the property has been on the market, how old the report is and if the asking price is in line with the valuation. Another important consideration is whether the surveying firm is on the improved panel of your mortgage lender – this can save you money by avoiding second surveys and valuations to satisfy your mortgage lender’s risk assessment.

Contractually Bound to Buyer Earlier

In England and Wales, a contract relating to the sale of a property is negotiated and signed by both parties. This means the terms of the offer are subject to the contract and nothing relating to the sale has been confirmed until both parties have signed and exchanged the contracts. This allows either party to walk away at a late stage in the sales process with no legal obligations.

In the Scottish conveyancing system, the buyer and seller exchange a series of smaller documents known as missives throughout the conveyancing process. The exchange of these missives makes the legal transaction binding earlier than the English and Welsh system. Although, missives can come with a lot of conditions that can make it possible for either party to withdraw from the transaction should certain circumstances arise.

Look out for being committed to a property earlier in the process and the conditions that have been attached to the missives by the seller’s solicitor. It is important to hire a solicitor that has experience working within the Scottish conveyancing system.

No Risk of Gazumping

In England and Wales, the seller is not required to remove their property from the market once they have accepted an offer. This can mean they can get a better offer after the sales process has started and pulled out of the deal. This known as gazumping.

The Law Society Scotland state that solicitors can not consider other offers once one has been accepted. This makes gazumping a rare occurrence in the Scottish conveyancing system.

Scottish Solicitors have a Bigger Role

In Scotland, solicitors have a bigger role to play in the buying and selling of property. Many solicitors in Scotland also double up as an estate agent, marketing and selling the property of their clients. So, it’s not only important to hire a solicitor that has experience with the Scottish conveyancing system as they are knowledgeable about the law, but also as they have extensive connections to the people responsible for marketing homes. Having a well-connected and knowledgeable solicitor is essential for both finding and buying a home in Scotland.  

Note of Interest

Instead of making an offer on a property, you pass the seller’s solicitor a note of interest to inform them of your interest in the property. The Money Advise Service has a comprehensive guide on how to start buying a house in Scotland.

Different Land Tax Systems.

The two countries have different taxes related to buying a property. England has Stamp Duty Land Tax, whereas Scotland has Land and Building Transaction Tax.

With Stamp Duty Land Tax, you will pay: –

  • nothing on the first £125,000 of the property’s purchase price
    • 2% on the next £125,000
    • 5% on the next £675,000
    • 10% on the next £575,000
    • 12% on the rest (above £1.5 million)

With Land and Build Transaction Tax you will pay: –

  • Nothing on the first £145,000 of the property’s purchase price
  • 2 % on the next £105,000
  • 5% on the next £75,000
  • 10% on the next £325,000
  • 12% on the rest (above £750,00)

Property tax and tiers change all the time, so it is important to research the current difference between the two systems when working out your budget.

When relocating to Scotland it is best you seek advice from professional services, to ensure that they can guide you through the different processes quickly and painlessly.

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