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These are the steps involved in buying a property:
What's the difference between freehold, leasehold and commonhold property?
- With freehold property, you are the owner of that property and no one else has a right to that property after a period of time.
- With leasehold property, you own the property but only for a specific period of time. You will have to pay a rent during your ownership and you will have to pay towards the costs of providing cleaning, heating and lighting of the common areas, such as the hallways.
- Commonhold properties are usually flats, but can also be houses. You will own a 'unit' as the freeholder (see above) but will be jointly responsible for the common areas, such as the hallways.
Can you afford to buy?
Before you start looking at properties to buy you should make sure you can afford it. As well as the purchase price you will need to pay for other expenses.
You should work out how much you can afford to spend. The following is a list of fees that you will usually have to pay:
- solicitor fees
- survey fees
- valuation fees
- mortgage arrangement fees/brokers fees
(you may also have to pay VAT on the above fees) - Land Registry fee
- stamp duty land tax on properties worth more than £125,000.
There are also the ongoing costs of owning a property, such as mortgage payments, maintenance of the property, bills for services such as your telephone line, and council tax.
The website http://www.bbc.co.uk/homes/property/mortgagecalculator.shtml will give you an idea of what you can afford. However, you should also talk to an independent financial advisor (IFA). You can look on the internet to find one at http://www.fsa.gov.uk/.
If you cannot afford to buy, you may like to consider the shared ownership options.