The cost of buying a house

Anyone who wants to buy a house in Scotland will need to engage a solicitor. It is important we give you an indication about the cost of buying your house before your go ahead.

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 £750 (exclusive of VAT) for any purchase up to a value of £100,000. This means the cost to you is £900 (including VAT). We charge a fixed fee of £850 (exclusive of VAT) for any purchase up to a value of £150,000. This means the cost to you is £1,020 (including VAT).

For any purchase of more than £150,000, we charge a fee based on 0.5% of the value of the property (subject to a minimum of £850 (exclusive of VAT). Please note that this figure is net of VAT and that VAT of 20% must be added to the charge to calculate the cost of our fee.

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 the value of the house. We have no control these costs. If you’re buying a house, you will have to pay 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 £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.

Land & Building Transaction Tax (LBTT)

*Land & Buildings Transaction Tax (LBTT) is a tiered tax and you have to pay this for any purchase over £145,000. It only applies when you buy a house and the buyer pays this cost. LBTT would be payable on this purchase – in this case it would be a charge of 2% and we have shown that in the calculation.

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 calculated the LBTT at 2% of the difference (£20,000) to arrive at our figure of £400.00.

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)

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

# 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 fee 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.

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.

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:

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. The level of fee charge will depend on who deals with this work for you. Here are our current rates per hour for the different categories of fee earner in our firm:

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