The cost of buying a house

You will need to employ a solicitor if you want to buy a house in Scotland. Because of that, It is important we provide an accurate indication of costs before you go ahead with 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 means we have to do additional work to help you buy your new house.

We charge a fixed fee of £795 (exclusive of VAT) for any house purchase.  This means the cost to you is £854 (including VAT of 20%).

In addition to our fee there are additional costs involved. These costs will vary depending on the value of the house. We have no control these costs. You are responsible for paying these costs. So, please be cautious if someone gives you only a note of the fee for the legal work. The actual costs will be more!

The additional costs of buying a 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 £160,000 (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.

 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 becomes due on any purchase over £145,000. 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 (£160,000) and deducted the normal nil rate band (£145,000) and calculated the LBTT at 2% of the difference (£15,000) to arrive at our figure of £300.00.

To work out how much LBTT you’ll have to pay, please use the Revenue Scotland LBTT Calculator by clicking here.

Additional Dwelling Supplement (ADS)

Where you already own property, anywhere in the world, an additional tax known as the Additional Dwelling Supplement (ADS) will be applied. Also, if you are buying a house 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 house. 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 charge at a flat rate 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 is very important that you budget for this additional tax.

Registration Dues

# Registration Dues of Disposition. A Disposition is the deed that transfers ownership of the property to you.  To have the deed registered in the Land Register, you have to pay a fee to the Registers of Scotland and the costs is based on a sliding scale depending on the price. The fees are set by the Registers of Scotland and full details of their charges can be found here.

** If you are taking out a mortgage over the property this will be secured by a Standard Security which forms a charge over the property in favour of your lender. In this situation, registration Dues of the Standard Security will need to be paid to the Registers of Scotland.

What’s involved in the purchase process?

When you buy a house, we will deal with the transfer of the title to the property into your name. There are essential steps we must take to achieve this. These are:

• Taking 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 your contract to buy (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 important 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 the 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 fee might increase?

Our fixed price fee covers all of the steps we’ve outlined above. Sometimes, however, there can be 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.

In such circumstances, we will explain the problem to you as soon as we find out about it. We will also let you know if we expect to be able 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.

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. 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 £250 per hour exclusive of VAT. That means the cost would be £250 per hour (inclusive of VAT of 20%).

If you would like more information or a detailed breakdown of the cost of your purchase, please get in touch.