Follow us on  Follow Expats Plaza on Facebook Follow Expats Plaza on Twitter Follow our Expat Blog  
   Home      Living in the UK      Housing (Buy or Rent ?)
Print this pageAdd to Favorite
Login


  
Newsletter


Action:

 
 

Buying or Renting? Tips for house hunting

 
Housing in the UK tends to be expensive. This is particularly the case in London (please see “Housing in London” for an in depth review of various areas of London).

Deciding whether to buy or rent your home will depend on your personal circumstances. Some people moving to the UK for the first time decide to rent for a period of 6 to 12 months while experiencing the pros and cons of living in a particular area and, when feeling settled, go ahead with buying a property.

It is also often the case that when living accommodation is provided by the employer as part of the relocation package, your employer will rent a property for you and your family to live in.

Each individual situation is different and, therefore, will require careful consideration. Buying or renting a property in the UK is definitely going to be one of the most expensive items in your monthly budget.

Generally speaking, whether you are looking to buy or rent a property in the UK, you will have to go through an estate agent. Nowadays the internet plays a role of paramount importance in home hunting. There are plenty of portals that allow you to review what is on offer in a particular area and all relevant details such as pricing, photos, floorplans, etc.

You will often find that properties which are either up for sale or rent tend to go very quickly (for rent this is particularly the case during the summer months when most people move around). Estate agents might warn you that it is essential to make a quick decision in order to avoid disappointment. However, it is always a good idea to avoid being pressurised to make an immediate decision. It is wise, at the beginning of your search, to take some time to view areas and a few properties. This is in order to have a good understanding of what is on offer on the market and make a more informed decision. Moreover, the experience of several expats contributing to this site has been that the properties you are shown at the beginning of your search tend to be the ones of a lesser quality (which probably have already been on the market for a while).  

While searching for your property, you need to be aware of the terminology used in the UK. Generally speaking the term “house” identifies an independent property which very often has its own back and front garden. The terms “flat” and “apartment”, instead, identify a residential unit within a building that contains several other residential units. All other conditions being the same, a house is priced higher than a flat or apartment.

The size of houses and flats tend to be described by “bedrooms” rather than by square metres. Therefore, if you believe that you will need two bedrooms in your property, you will need to look for a “two bedroom house” or a “two bedroom flat”. Please be aware that – especially in London – you might find the size of the rooms to be smaller than what you are used to in your home country.

The standard of housing in the UK might be either higher or lower than the one from your home country. Several expats contributing to this website have found the standard of housing in the UK to be generally lower than what they could obtain, for the same price, in their home country.
 

Renting

 
If you decide that renting is the right option for you, according to your circumstances, you may want to:
  • Rent an unfurnished property
  • Rent a furnished property
  • Rent a serviced apartment

The rent rate of properties is normally quoted “per week” in London, while it is generally quoted “per month” in other parts of the UK. The amount quoted does not normally include tax or utilities (council tax, water, gas, electricity, etc.). It is always a good idea to ask what is included in the asking rent and also the amount of council tax that living in the property will attract. This amount varies significantly from area to area and is set by the local authorities (the Council) every year. Just as guidance, the average one bedroom flat in London is likely to attract an average £1,000 per year in council tax.

 As at June 2010, available data on rental prices in the UK shows the following averages:
 
Area

Average Monthly Rent

Central London

Approx £3,800

Outer London

Approx £1,800

North UK

Approx £500 to £700

Central UK

Approx £600 to £800

South UK

Approx £800 to £1,200

 

You should remember that the above figures are just averages. If you are looking for a property to accommodate a family of three or four in a popular area of London (normally with good schools available and a low crime rate), it is likely that you need to have a budget of approx £1,000 per week available.

In renting, the owner of a property is called “landlord” and the person renting the property is called “tenant”.

As already mentioned above, the internet will allow you to have access to search engines that will be able to show you prices and availability in the area you have selected.

Once you have found a property that suits your needs, you will need to make an offer. Remember that this offer is not binding on either yourself or the landlord until you have signed an agreement. This means that the agent will be able to receive additional offers from other prospective tenants. According to how well positioned you are for the negotiation of terms, it might be a good idea to insist that no additional offers be accepted by the Landlord while you are completing the rental agreement.

If the property is being rented by your employer, and your employer is a well established corporation, you will normally have the possibility to negotiate with the landlord. Landlords tend, in fact, to like corporate tenants because they give them a higher degree of security that the rent will be paid on time.

If, during your negotiation, you ask for improvements to be made to the property, make sure that these are listed in a clause of your rental agreement. This is in order to avoid misunderstandings or refusal to carry out the works agreed afterwards. 

Once your offer is accepted, the estate agent will need to obtain references from you (employer, bank, etc.). These will normally be forwarded to the landlord for his review. Moreover, you may be asked for a small deposit. Reputable estate agents will normally ask for a modest sum (in line with the level of rent you have offered) and give you a receipt for the deposit.  They should also explain in writing what happens to the deposit if the rental agreement is not completed.

The estate agent will then present you with a rental agreement. Make sure you read it and feel comfortable with the terms and conditions and, if not, ask for amendments before signing it.

The rental agreement will include the term of the contract. This is normally 6 or 12 months, renewable (you can negotiate longer or shorter terms to suit your needs). Whatever the term, it is a good idea to negotiate a break clause after a given number of months. This will allow you to move on quickly if you experience problems with living in the property. There are several types of rental agreements according to the particular circumstances. The most common, when renting privately, is the “Assured Shorthold Tenancy”.

You will almost certainly be required to pay a security deposit before entering the property. In London this is commonly equivalent to six weeks of rent. According to the type of tenancy agreement, your deposit will most likely be held by a third party tenancy deposit protection scheme. This will protect you from a landlord making unfair deductions from your deposit at the end of the tenancy. In view of this, make sure it is very clear in the rental agreement who is holding the deposit and in which circumstances the landlord can make deductions from your security deposit.

Before you enter the property you will be required to sign an “inventory check-in”. This document is normally prepared by an “Inventory Clerk”. Make sure that you are not rushed into signing this because deductions from your security deposit will be based on this document. It is therefore a good idea to ask to visit the property before the check-in takes place so that you can make a note of anything which should be reported in the inventory (defects, broken or damaged items, the condition of fixtures and fittings, etc.). It is also recommended that you take photos or film the condition of the property when you enter it. Should you notice something afterwards, it is always a good idea to report it to the landlord in writing.

The landlord is normally responsible for giving you a cleaned property and you are responsible for returning it cleaned. Make sure that the property has been professionally cleaned before you move in and, if not, request that this is done.

Once you have moved in, you will need to notify various parties. In particular, make sure that you immediately inform your local authority for council tax purposes. You will then need to inform the various utility companies supplying your house (gas, electricity, phone, internet, satellite tv, etc.) to take over the accounts from the previous occupier. To this end, make sure that as part of the check-in process the reading of all meters (gas, electricity and water) is noted. You will need to communicate this to the utility companies in order to be charged only for your consumptions.

Experiences of expats contributing to this website vary when it comes to renting. A general consensus seems to be that you need to be careful with every step of the rental process in order to avoid surprises. With the widespread use of e-mails today, it is a good idea to use this to communicate to landlords and estate agents. This is in order to keep a written record of what was agreed and discussed.
 

Renting a serviced apartment

 
According to your personal circumstances, you might want to consider renting a serviced apartment instead of a property. The concept of a serviced apartment is similar to the one of a hotel. You can rent from a small studio up to a large four bedroom apartment in a building which normally has a reception, gym and swimming pool. Also, services such as cleaning and laundry normally come with the package.

A serviced apartment can allow you to live in a “home like” environment with the services of a hotel. They are normally located both in business and residential areas to suit all needs.

It might be a good choice for you while you are looking for your more permanent home or if you are single and want to live near your work and enjoy the facilities available at a serviced apartment.

The internet will greatly help you to find a serviced apartment in the area of your interest. There are several solutions available, for several different budgets.
 

Buying a house

 
For most people, buying a house is one of their most significant financial commitments. It is therefore very wise to make sure you fully understand the process of buying a house in the UK before moving ahead with this. Estate agents, banks, financial advisers, lawyers and property surveyors will be an invaluable source of information for you to successfully complete the purchase of a property in the UK.

In this section you should read “UK” as “England and Wales only”. Different rules apply to Scotland.

As at September 2010, available data on property prices in the UK shows the following averages:

Area

Price

UK

Approx £220,000

Central London

Approx £450,000

Outer London

Approx £300,000

North UK

Approx £155,000

Central UK

Approx £180,000

South UK

Approx £250,000

 

In the UK, Estate agents’ fees are normally borne by the seller. Therefore the buyer is normally not expected to pay for the services of the estate agent.

In the UK you can buy a property either as freehold or as leasehold. Freehold properties are those where the buyer owns it indefinitely. This is most noticeably the case when buying a house. Flats or apartments are normally subject to leasehold. This means that your ownership is limited in time (the most common terms used in the market being 99 years, 125 years or 999 years).

Purchasing a property in the UK attracts a tax called Stamp Duty, which currently is:

Price

Stamp Duty

Up to £125,000

0%

£125,001 - £250,000

1%

£250,001 - £500,000

3%

Over £500,000

4%

 

Sometimes special concessions are available for certain categories (example: first-time buyer). It is therefore wise to verify this at the time of purchase.

If you need a mortgage to buy the property, before you start the process of searching for your new house or flat, it make sense to identify how much you will be able to borrow from a bank and, possibly, obtain from the bank an “agreement in principle”. There are many providers of mortgages in the UK. The websites of most banks will give you information about their products. Alternatively you may want to utilise the services of a mortgage broker or financial adviser. The advantage of knowing beforehand that a bank will lend you a certain amount of money to purchase your property is extremely important in order to be able to make offers quickly and complete your purchase seamlessly.

It also makes sense to find a lawyer and a surveyor to assist you beforehand. Once again, this will allow you to proceed swiftly in the purchase of your property.

Before making offers, make sure you have talked to your lawyer and that he/she has explained to you all the implications of making an offer on a house and proceeding with the exchange of contracts with the seller.

Once your offer is accepted and you have obtained confirmation from your bank that they will grant you a mortgage, you should get your surveyor to inspect the property. This will be needed for the mortgage purposes but, especially, for you to have a fair view of the value of the property and any possible issues with it.

Your lawyer should then start the “conveyancing” process. He or she will also carry out several verifications in order to make sure that the ownership of the property is correctly passed onto you. Your lawyer will also exchange with the bank granting the mortgage all the necessary paperwork.

Once the contract is finalised, you will be requested to sign it. You will also receive a copy of the contract signed by the seller. This is called the exchange of contracts. At this stage you will normally pay the seller a deposit (usually 10 per cent of the purchase price).

The contract will usually specify a completion date, which is the date you will need to pay the remainder of the purchase price and will receive the keys of your new property.

Generally speaking, the time required from your offer being accepted and the completion date varies between 4 and 6 weeks.

Remember that you will need to insure your property, register the change of ownership at the Land Registry and pay the Stamp Duty.

 
 
 
 
All the information on Expats Plaza is free to view. If after having reviewed the information on Expats Plaza you believe this has been useful to you, please visit the Support Us page.
 

 

 
 
All the information on Expats Plaza is free to view. If after having reviewed the information on Expats Plaza you believe this has been useful to you, please visit the Support Us page.
 
 
This page was last updated on 02.10.2010
 
 
Expats Plaza is the website for the Expatriates living in the UK