Cost of buying a house
If you want to buy a house in Scotland you will need to use a solicitor. Therefore, it is important you know about the cost of buying your house before your purchase.
We aim to charge for a house purchase on a fixed fee basis. That means we look to keep to the figure we’ve given you. However, there are sometimes situations outwith your or our control that mean we have to do additional work to help you buy your new house.
The fee we charge is based on the value of the property, as you can see from the following table:
|Fee||VAT||Total Cost (incl. VAT)|
|Up to £50,000||£500||£100||£600|
|£50,001 – £100,000||£550||£110||£660|
|£100,001 – £200,000||£600||£120||£720|
|£200,001 – £300,000||£700||£140||£840|
|£300,001 – £400,000||£800||£160||£960|
|£400,001 and above||£950||£190||£1,140|
This fee covers the legal work we will do for you and which we will outline later.
Our fee is only part of the cost of buying a house. There are additional costs involved. Some of these costs will vary, depending on a number of factors, one of which is the value of the house. We would stress that we have no control at all over these costs. If you’re buying a house, you will have to pay these charges. So, please be cautious if someone only gives you a note of the fee for the legal work. The actual costs are likely to be very much more!
The additional costs of buying a house
Buying a house attracts a set of specific additional costs and taxes. These additional costs, especially Land & Buildings Transaction Tax, can vary depending on the purchase price you pay for the house.
We will now provide an example of costs when you buy and when you buy a house.
For the purposes of this exercise, will base the costs on a purchase price of £165,000 (which is around the average price of a property in Scotland).
Once we know the exact price of the house you’re buying, we’ll send you a detailed breakdown of the costs along with our Terms of Business.
Cost of buying a house
|VAT on the Fee||
|Land & Building Transaction Tax *||
|Registration Dues of Disposition #||£400.00|
|Registration Dues of Standard Security **||£80.00|
|Cost of Advance Notice||£20.00|
Land & Building Transaction Tax (LBTT)
*Land & Buildings Transaction Tax (LBTT) is a tiered tax. It only applies when you buy a house and the buyer pays this cost. LBTT applies on any purchase over £145,000. You should also be aware that first-time buyers have a higher nil rate band of £175,000 which means that a first-time buyer purchasing a property for this price would pay no LBTT.
LBTT increases as the price of the house increased.
For the LBTT calculation, we have taken the price (£165,000) and deducted the normal nil rate band (£145,000) and calculated the LBTT at 2% of the difference ((£20,000) to arrive at our figure of £400.00.
Additional Dwelling Supplement (ADS)
Please note that in certain circumstances, generally where you already own property, whether in Scotland or elsewhere in the world, an additional tax known as the Additional Dwelling Supplement (ADS) will be applied. If you’re purchasing a new home but haven’t sold your existing house, the ADS will apply. Once you sell your existing house, you can then reclaim the ADS you’ve paid. However, it’s important to understand you must pay this before you can buy your new home. ADS is charged at 4% on the full purchase price of the house (on all properties where the price is more than £40,000). This is a flat charge of 4% on the full purchase price and is payable in addition to any Land & Buildings Transaction Tax (LBTT) due. If you find yourself in this position, it’s very important that you budget for this additional tax.
# Registration Dues of Disposition (the deed that transfers ownership of the property to you) to have the deed registered in the Land Register is on a sliding scale based on price. The fees are set by the Registers of Scotland and full details of their charges can be found here.
** Registration Dues of Standard Security will apply if you are taking out a mortgage over the property that has to be secured by a Standard Security which forms a charge over the property in favour of your lender.
What’s involved in the purchase process?
A property purchase is a process which we will lead you through to successfully transfer the title to the property into your name. There are essential steps we must take to achieve this. These are:
- Take your instructions and giving you advice
- Carrying our anti-money laundering checks to comply with regulations
- Preparing and submitting an offer for the property
- Advising you on the acceptance and negotiating conclusion of the purchase contract (missives)
- Examining the title to the property and reporting to you
- Raising relevant questions on the title with the seller’s solicitors
- Receiving and checking various reports and searches
- Preparing the deed transferring ownership of the title to you
- If you are obtaining a mortgage:
- preparing the Standard Security, explaining its content to you and having this signed
- Reporting on Title to your lender and requesting loan funds
- Providing you with a completion statement outlining deposit and funds required
- Settling with the seller’s solicitor and arranging release of the keys to you
- Sending your title to the Registers of Scotland for registration in the Land Register
- Confirming completion and accounting to you
Are there circumstances where the cost of buying a house might increase?
Our fixed price fee covers all of the steps we’ve outlined above. However, as we indicated above, there can be some circumstances where additional work is required. There may be issues of title to be resolved or problems with alterations or additions made to the property. There may be a problem with the property boundaries or some adverse notice issued by the local authority. These are just some of the problems you might face when buying a house. We always attempt to deal with these promptly and properly and try to carry out the additional work within the fixed fee quoted. However, on occasions, the nature and complexity of the problem means that significant additional work is required to rectify the problem.
In such circumstances, we will explain the problem to you as soon as we find out about it. We will let you know whether we expect to resolve this within the fixed fee price we’ve quoted. If the work is of such a nature that it will take considerable additional time or is of a complex nature, we will advise you of the additional likely cost to resolve the issue and fix the problem.
Here are some issues that regularly appear
Some additional issues regularly appear in purchase transactions and we are able to advise of the additional charges required to resolve these. The following items attract the charges set beside them:
|Additional Item||Fee||VAT||Total Cost (Incl. VAT)|
|The purchase triggers a first registration in the Land Register||£250||£50||£300|
|A Home Loan Fund or other Help to Buy assistance documentation requires to be dealt with||£250||£50||£300|
|Fulfilling requirements to allow you to claim your help to buy ISA||£100||£20||£120|
|Checking certificates for alterations and having these approved by the surveyor||£100||£20||£120|
|Dealing with the Additional Dwelling Supplement (where appropriate)||£75||£15||£90|
Where we need to carry out additional work for you and if it does not appear in the table above, we will charge a time-based fee at the rate of £200 per hour exclusive of VAT. That means the cost would be £240 per hour (inclusive of VAT)
If you would like more information or a detailed breakdown of the cost of your purchase, please complete this short enquiry form.
If you want to find out more about the conveyancing process, please check out our article: Conveyancing solicitors – what are they and what do they do? by clicking here.