Buying and selling property is something that many people do at some point in their lives. Some do it multiple times, while others only once or twice, but for most of us, it's one of the biggest transactions we will ever make. Even so, for something so prevalent, the process is often mired in mystery, which can make it unnecessarily daunting.
To help shed light on what happens after an offer on a property is made, this article explores the key stages that follow, along with practical steps to keep everything moving smoothly. Whether you’re buying or selling, understanding what happens from the legal process to buildings insurance, surveys to property chains, will give you everything you need for a smoother journey.
Once the viewings have taken place, submitting or receiving an offer on a property is an exciting next step marking the first formal stage of an exciting process.
For prospective buyers, you typically submit an offer via the estate agent who is listing the property. All you need to do is express your interest and the amount you would like to offer for the property - that might be the asking price, more, or less, depending on the circumstances. The agent will confirm the offer you would like to make by email, and convey it to the seller. Once they have an answer as to whether the seller would like to accept, your agent will let you know.
Having placed your property on the market with an estate agent, as a seller, all you have to do is wait to see if an offer comes in following a viewing. Your agent might phone you to let you know a prospective buyer is interested, but they will usually follow up with an email as well to communicate what the offer is. They will also be able to advise and facilitate any negotiations until you either accept or reject the offer, and all decisions will be confirmed both to you and the buyer separately in writing.
More often than not, when it comes to buying or selling, there’s a ‘property chain', involved, which simply means there are other people buying and selling houses as well, and those connected transactions need to be considered for your property purchase/sale to be successful.
For example, the person buying your house will often be selling a house to someone else who may also be selling a property. Equally, if you are selling a house, you may be buying another one, and that person will be looking to go to a new property as well.
The admin around this chain will largely be handled by the agents, but it is important to be aware of it because in most cases this is the trickiest piece of the puzzle. For buyers, the dependency on selling one property to buy another can lead to delays, and for sellers, being reliant on other transactions taking place can mean having to be patient.
Although this can be a frustrating part of the process, it's also important to know that chains are common and an experienced agent will be well-versed in managing them successfully through good communication. In the meantime, you can help keep the process moving by:
Ensuring you have all your documents and financial information in place (securing a mortgage in principle if you need one, as well as having deposits and other funds in place).
Proactively communicating with your solicitor, estate agent, and mortgage broker as things unfold.
Responding to any communications and questions from other parties promptly and helpfully.
Things that can help keep the chain short include finding (or being) a cash buyer with nothing to sell and no mortgage requirement, or having (or being) a seller who is prepared to move into rented accommodation for a period of time.
Instructing a solicitor is an important part of the buying or selling process. It's not a legal requirement to have a solicitor but it's highly recommended in order to navigate the legalities of the transaction. The solicitor's purpose is to handle all the legal aspects of the property transaction, making sure everything is done properly.
Instructing a solicitor is easy to do, fees are fairly standard (although they can vary from one firm to the next), and many firms have a department that deals in conveyancing (the process of transferring the legal title of property from one person to another).
For those who are buying a house, your solicitor will:
Conduct property searches and ensure the property's title is clear (making sure there are no potential disputes that may occur).
Review the contracts.
Manage the transfer of funds - this includes ensuring legal fees, disbursements, and stamp duty are paid.
Act as an intermediary between you and the seller (via their solicitor).
Their involvement helps to make sure that any issues with the property you're buying are resolved, reducing any delays, and handling any complexities that arise. In some cases, mortgage lenders require that you have legal representation when buying a property as well.
For those who are selling a house, your solicitor will:
Gather all necessary information for the legal aspects of the sale.
Review legal contracts and liaise with the buyer's solicitor to ensure a smooth completion.
Manage the exchange of funds including deposits - this includes ensuring legal fees, disbursements, and stamp duty are paid.
Keep you informed about the progress of the sale.
Oversee the exchange of contracts and completion of the sale to make sure everything is done properly.
Liaise with the lender to ensure all financial arrangements are in place if necessary.
Arrange the transfer of deeds to the buyer.
Ensure the sale proceeds are transferred to you.
To instruct a solicitor, simply find a firm that handles conveyancing - personal recommendations from friends are always a good place to start, and often your estate agent will be able to recommend someone locally. However, it's advisable to get more than one quote so you are happy with the person you choose. It's advisable to instruct a solicitor as soon as an offer is accepted, but your estate agent will let you know when they need their details.
Surveyors are professionals who act on behalf of a buyer, inspecting the prospective property to make sure there aren't any major problems which may impact the sale. That includes looking both inside and out, checking for structural issues, damp, subsidence or infestation, alterations to the property that didn't have planning permission, or any damage which may require imminent repairs.
While there's no obligation to have a survey carried out, it's highly recommended to help identify any issues. Sometimes these can impact the value of the property (if the roof needs replacing, for example), or if there are more serious problems, like subsidence, it can have an impact on whether a bank will lend against the house.
It is up to the buyer whether they choose to have a survey done, and there are costs involved. For example, the Homeowners Association estimates that it can range from £300 to £1500 depending on which level you choose.
There are three main levels of property survey:
Level 1 is a Condition Report, which will look at the basic condition of the property to highlight major issues.
Level 2 is a Homebuyer Report, which is a more detailed survey including a valuation for insurance purposes.
Level 3 is a Building Survey, which is the most thorough type of inspection, including a full structural assessment.
If you are a buyer and you require a mortgage for the purchase of the property, you will most likely already have spoken to a lender and had a mortgage in principle based on your affordability. This is the basis on which you may have made your offer.
Once your offer has been accepted, a mortgage lender will commission their own valuation to make sure they feel that the house is worth the amount you are borrowing. This will be done by a qualified surveyor, but is separate to the home survey that you might commission.
At this time, your mortgage lender will also conduct any final checks to determine affordability, which will include making sure that no new debts have occurred, or any changes to your income. Any changes that can cause delays include:
Down valuation: When the surveyor has a reason to think the property is worth less than the agreed price. This is usually the result of structural issues.
Building survey issues: Such as subsidence, damp, and urgent repairs.
Title issues: Where current ownership is not clear or there are unresolved legal issues relating to the property.
Incomplete or inaccurate documentation: Information that's missing and means that the valuation process can't be completed.
Changes to income: If the buyer's income has gone down since the time that they applied for the mortgage, making it harder for them to afford repayments.
For buyers, your solicitor will alert you to the need to have buildings insurance. This needs to be in place from the date that you exchange contracts on your property and become the legal owner, so it should be arranged in advance. It's also a condition of most mortgages, and lenders will typically require proof of building insurance to approve the loan.
Building insurance is exactly what it sounds like - it insures the structure of your property against damage from issues like storm, fire, or flood. Typically it will cover aspects of the property like the roof, walls, windows and some permanent fixtures like kitchens and bathrooms, but it is separate from contents insurance. Usually people have insurance to cover the amount of money it would take to rebuild the property if something happened.
Building insurance is easy to arrange with most major banks as well as specialist providers, but it's a good idea to get a couple of quotes.
Once everything is in place, the sale or purchase of the property can move forward. Exchanging contracts is the next step, where both the buyer and seller sign legal contracts committing to proceed with the sale. This is an important and exciting step in the process, and it's usually where the buyer pays the agreed deposit and a completion date is set.
The typical amount of time between exchange and completion on a property is between one to three weeks, but in some cases, exchange and completion can even happen on the same day. This timeframe depends on whether there is a chain, sometimes new build properties have longer notice periods, delays with legal paperwork, and occasionally unforeseen problems arise.
Understandably, this waiting period can be anxiety-making as well as exciting, but there's plenty you can do while solicitors and estate agents work on your behalf. For example:
You can double check that your finances and insurances are in place.
Set up plans for moving day.
Notify your utility providers to set up services at your new address.
Let the local council (and any other necessary people) know about your change of address.
You can even start packing!
On the day that the property purchase is complete, the remaining funds are transferred from the buyer to the seller along with the legal ownership of the property. The buyer can then arrange to move into their new home, and the seller is required to leave - usually by a set time.
The buyer's solicitor will handle the transfer of funds and notify the Land Registry about the transfer of property ownership. The estate agent will be allowed to hand over the keys to the property. Both the buyer's and seller's solicitors will confirm the completion with their clients, and each individual can celebrate a successful sale!
While all of this can be a lot to digest, both buyers and sellers can rest assured that an experienced agent, like Chestertons, will guide you seamlessly through the process, letting you know what you need to do at each stage. Buying or selling a property is an exciting time, and a successful sale is something to celebrate.
At Chestertons, we work hard to make sure that the process is as enjoyable as possible, with more than 200 years’ experience, and a team of experts offering a range of services that not only include buying, selling, and letting property, but span consultancy and research, asset valuation, financial support and more.
Whether you're buying or selling a property, or are simply curious about what your home might currently be worth, you can speak to your local Chestertons office for practical, informative advice.
Get in touch with your local Chestertons branch here.