A Guide to Buying Property in Scotland

The Scottish system for buying property differs from elsewhere in the UK. This brief guide doesn’t cover every possible aspect or scenario but offers a general overview of the process when purchasing a residential property in Scotland.

Making An Offer

Pricing: Offers Over/Fixed Price

Many properties in Scotland are marketed at an ‘offers over’ price. This generally means that the seller is hoping to secure a sale price above the amount quoted. In general, the asking price will be lower than the valuation figure as a way to entice viewing activity.

If a property is advertised as ‘Fixed Price’, the first person to offer that price will secure the property. The latter is often used if the seller wants a quick sale or the if the property has been on the market for a while with no interest to bottom out the sellers minimum acceptable price.

There are various other terms including offers around, offers in the region of, guide price and more however the two noted above are the most common in Scotland at the present time.

Noting Interest

If you are interested in purchasing a particular property, you should engage a solicitor who will formally note your interest with the sellers estate agent. This does not oblige you to purchase the property or even make an offer but confirms your serious interest in the property so you will be kept informed of developments, often this will be confirmation of a closing date.

Closing Date

It is not unusual for a closing date to be set for the submission of offers when there is a lot of interest in a property.

Each interested party submit a written offer through their solicitor on an appointed day and at an appointed time. All offers and their conditions will then be considered by the seller. Normally, you will hear the result of your offer on the same day. Sometimes this can take slightly longer if the seller is abroad or multiple parties require to be consulted however the sellers agent should advise of this on the day of the closing date. The seller is expected to accept or decline any offers as submitted and no further negotiates on price should be discussed after the closing date.

The seller is not obliged to accept the highest or, indeed, any offer at a closing date.

Offering

In Scotland, a formal offer for property must be submitted by a solicitor. The offer will include your details as the purchase, the price, the date of entry, details of any extra items to be included in the sale, and the standard legal terms to complete the conveyancing. The offer may be ‘conditional’ on certain requirements on your part, for example securing your financing or selling an existing property.

The offer will make reference to the Scottish Standard Clauses, which are 30 clauses that will form part of the contract for the purchase. They are widely accepted as being fair to both the seller and purchaser and cover all the legal requirements and allow for the appropriate checks to be made to ensure you get good title to the property.

When a property is marketed in Scotland the seller must provide a Home Report which includes a Single Survey, Mortgage Valuation and Energy Performance Certificate. This is designed to be relied on by a purchaser. You may still wish to have an independent survey or additional specialist reports over the property you are considering buying, depending on the terms of the Home Report. In advance of making an offer, your solicitor will review the Home Report with you and discuss the requirement or benefit of requesting additional reports/surveys.

The Conveyancing Process

Acceptance and Missives

If your offer is verbally accepted, the seller’s solicitor will send your solicitor a formal acceptance, which may include ‘qualifications’ in response to the conditions of your offer. The acceptance is therefore referred to as a ‘qualified acceptance’. Your solicitor will discuss the acceptance with you and negotiate on your behalf with the sellers solicitor. The offer, acceptance and any subsequent letters, which are intended to be part of a legal contract, are known as the ‘missives’.

When the final acceptance letter is issued, missives are said to be ‘concluded’  meaning that the purchaser and seller have entered into a legally binding contract and cannot withdraw from it without penalty. Your solicitor will advise you when the missives are concluded and will send you a copy of the full contract.

Conveyancing

The offer and Standard Clauses provide for your solicitor to have a period of time to check all the legal details to ensure you get good title to the property. This will include checking the title deeds for any restrictions on use or obligations; ascertaining that any previous alterations and/or additions have been properly certified; whether there are any planning applications that may affect the property; and so on. The Seller is obliged to provide certain property searches which confirm various details about the property, again to be checked in detail by your solicitor.

Settlement

Settlement takes place on the date of entry, as provided for in the missives. The purchase price is paid to the seller’s solicitor in exchange for the disposition (the legal document that will transfer ownership of the property from seller to purchaser), title deeds, other documentation and the keys to the property. It is very important that your funding is fully in place well in advance of the date of entry. Your solicitor will calculate the balance required for settlement, to include any Land and Buildings Transaction Tax and fees due.  You will be asked to transfer the funds to your solicitor rather than directly to the seller. If you are getting a mortgage your solicitor will liaise directly with the lender and arrange for the funds to be transferred in advance of the date of entry.

Immediately on taking entry you should check that the property is in good order, that any specified fixtures and fittings and any extras, which were included in the sale, are present and that all systems, such as the central heating, are fully functioning. If there are any discrepancies, you should advise your solicitor as soon as possible. You have 5 working days to report any issues to the Seller if any of the systems are not in proper working order.

Your solicitor will also arrange for Land and Buildings Transactions Tax to be paid and will send the disposition for registration in the Land Register. Once the disposition and all relevant documents have been registered, they will be sent to your mortgage provider, if applicable, or to your solicitor for safe keeping. Your solicitor will send you a copy of the Land Certificate, which is your title to the property.

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