Purchasing or selling a property is a large undertaking and this guide aims to detail and breakdown ALL the associated costs, so you don’t over pay by a penny!
We run through the legal fees, when they are paid, what a conveyancer actually does and all the disbursement fees.
Leasehold properties require further searches and legal work – we run through those and how much they are likely to cost but most importantly who pays for what…
The Bottom Line
- Legal fees often called conveyancing fees, whether you are buying or selling should cost £850-£1500. Obtaining a fixed conveyancing fee is considered a good idea, so costs dont spiral.
- The buyer will have fees called Disbursement Fees on top of legal conveyancing fees. For freehold properties these are usually between £732-£1266, these are broken down further below. The seller is not typically liable for any disbursement costs.
Total Legal Conveyancing Fees and Disbursement Costs for buyers of Freehold properties are therefore between £1582-£2766.
For leasehold properties the buyer and seller can usually expect to pay extra fees, for further searches and transfers, of between £300-£1000.
- Those figures are excluding Stamp Duty Land Tax which cannot be averaged as it is dependent on the sale price of the property. Stamp Duty Land Tax is only payable on properties over £125,000.
- Legal fees are usually paid on the date of completion, although there may be a small upfront deposit.
- The solicitor conveyancing doesn’t need to be local to you, as everything can be emailed and signed electronically.
What do conveyancing solicitors do?
Buying or selling any property is a large enough task and aspects can appear daunting. It’s therefore really helpful to know who handles what aspect of each task.
Conveyancers handle all the legal aspects of transferring ownership from the seller to the buyer. Whilst this is possible to do yourself some mortgage providers will insist that the conveyancing is handled by a professional firm.
Hiring a conveyancing solicitor is called ‘instructing’. When instructing a conveyancing solicitor you can ask them for an estimate for their legal costs. These costs however won’t include the disemburments. Lots of conveyancing solicitors will work for a fixed fee and this can really help, so the costs dont mount up if there are any issues.
Conveyancing Cost Breakdown
The legal fees make up just part of the total conveyancing bill. The legal fee covers the work carried out by the conveyancing solicitor. Conveyancing fees vary but are between £850-£1500. Expect to pay more in London and areas of the south east of England. Legal costs are more for leasehold properties.
On top of the legal fees are disbursement costs, we will detail these below:
When buying a property, ‘local authority searches’ are things covering aspects like drainage searches, environmental searches and even planning searches. Planning searches will report if there are any developments planned in the local area. Local Authority Search costs usually between £250-£450.
The Land Registry fee for transferring ownership into the buyers name is £200-£300.
Stamp Duty Land Tax (SDLT)
SDLT will need to be paid if the property you are buying is more than £125,000. This fee is variable as it is dependent on the purchase price of the property. There are certain percentage ‘brackets’ in which properties come under. The higher the purchase price the higher the SDLT fee.
Help to Buy Supplement
If you are buying using the Help to Buy Scheme there is typically an extra charge as there are extra legal works to be undertaken. Help to Buy supplement costs are typically £150-£300.
Lifetime or Help to Buy ISA
To redeem the bonus the solicitor has some extra work to do and this is charged at £50+VAT
Gifted deposits require extra paperwork than standard deposits. As such this costs more as they have to prove the legitimacy of the money. Charges for this are typically £40-£100.
Telegraphic or Bank Transfer Fee
As per your mortgage provider’s request your solicitor will need to telephonically transfer the funds on a certain day. The charge for solicitors to perform this task is £20-£30.
Anti-Money Laundering Checks
This check is for identity verification. Therefore if you are a foreign national or living abroad, expect to pay slightly extra. The Anti-money Laundering check is £6-£20.
Property Fraud Check
This is to run a check to confirm that where you’re sending the money to, is legitimate. Checks are £10
When selling any property you are required to get a copy of the ‘Title of Deeds’. The Title of Deeds are normally held by the Land Registry. Title Deeds for Freehold properties are less than Leasehold. Title Deeds cost £6
Costs for Transferring Leasehold Property
The costs below are indicative for the transfer of leasehold property in the context of flats. To ensure it’s clear which costs are applicable for a specific property and payable by whom in advance, instruct your conveyancer to review this at an early stage.
Typical costs total are £300-£1000 as detailed below:
Management Packs [paid by seller or purchaser] circa £500+VAT
This will be requested by the solicitors from either the freeholder or the agent managing the freehold. It includes items such as details of the service charge arrears, notes of forthcoming major works and copies of current buildings insurance. If the freeholder has an up to date management pack there could be no charge for this. If the managing agent is a professional company there is often a charge for the management packs.
Share Transfer Fee [paid by the purchaser] £100+VAT
This fee is paid to the freeholder or managing agent for the transfer of the share certificate, from the sellers name into the buyers name.
Notice Fees [usually paid by the purchaser] £0-£100+VAT
After compilation, the new owner is normally required to serve formal notice to the freeholder. This includes the freeholder being notified of the change in ownership.
Further less common costs for transferring leasehold property below: [Often these can be ‘hidden’!]
License to Assign Fees [paid by seller] £250-£750+VAT
Only some leases, not all require this provision. Assign fees are due when the outgoing tenant requires the freeholders consent to sell their lease.
Deed of Covenant Fees
If entering into a License to Assign, some leases require the new tenant [the buyer] to have a direct contract with the freeholder or management company. This fee between the buyer and seller is often contested.
Conveyancing Fees FAQ
When do I pay solicitors fees when buying a house?
You typically pay the initial deposit upon instruction i.e at the beginning. The balance is then payable upon completion.
Does a conveyancer need to be local?
No, a conveyancer does not need to be local, as typically they don’t need to be visited. In the past people would instruct their local solicitor as they wanted them to be close by if they needed to sign and review documents. This helped speed up the sale process.
Nowadays with email and the internet the conveyancer could be located anywhere. Documents can be sent and reviewed online instantly and they can be signed electronically.
If you live in an area such as London where legal fees are generally higher than the rest of the UK it could be more cost effective to instruct a conveyancer outside of London.
How do I find a conveyancer near me?
Using the internet to find a firm of solicitors is a great option. Typically any solicitors will have a conveyancing specialist. Some firms of solicitors just handle the sale and transfer of properties, as it is a very common service. There are comparison sites comparing the services and fees of conveyancers, using one could save you hundreds of pounds.
Conveyancing Costs Summary
- Try and obtain a fixed fee for the solicitors conveyancing fees that way it will stop them spiralling, if there are unforeseen issues. Legal conveyancing fees are typically paid on the date of completion, however a small upfront deposit isn’t uncommon.
- As early on in the process as possible obtain, from the conveyancing solicitor a list of disbursement fees that apply to the property. This is especially true if its leasehold as some fees can be ‘hidden’. You can then establish what has to be paid and by whom.
- After the final balance is paid for the legal fees, if buying, the solicitors will still have work to do as they then have to pay the Stamp Duty Land Tax [SDLT].
- Buying and selling a property is a major event in peoples lives, so if you aren’t sure about anything ask someone. The earlier you do that, the better!