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Buying in Scotland (Survival Books)

The procedure for buying property in Scotland is not the same as the rest of the UK. Almost all property (including apartments) is owned differently in Scotland, where there’s no such thing as freehold or leasehold property. Instead of being owned outright, property is held from another person – similar to a lease that a tenant holds from a landlord. In feudal terminology, the person holding the land is termed the vassal and the person from whom the land is held is called the superior. In practice vassals regard themselves as the true owners of the land, although the original landowner or developer (the superior) may have laid down conditions regarding its use or which prevent alterations, which may be in force in perpetuity unless waived or modified.

Feudal tenure was abolished by the Scottish Parliament in 2000, but the rights of superiors had not been removed at the time of writing.

When buying an apartment you should examine the whole building for defects and ensure that any repairs to the common elements or structure are shared equally among the owners.

Purchase Procedure

The purchase procedure in Scotland is different from the rest of the and is as shown below:

• Apply for a mortgage;

• Engage a solicitor or conveyancer (mandatory in Scotland);

• Find a property you wish to buy;

• Ask your solicitor to ‘note interest’;

• Complete a mortgage application;

• Get a valuation or survey;

• Have the mortgage application agreed;

• Make an offer on the property;

• Complete the mortgage application;

• Offer is accepted;

• Fix a settlement date;

• Arrange buildings insurance;

• Solicitors complete missives (contracts);

• Settlement (completion);

• Move in!

Solicitors

When buying property in Scotland you need to engage a solicitor to act on your behalf. The Law Society of Scotland (0132-226 7411, www.lawscot.org.uk) provides a Directory of General Services listing Scottish solicitors. You should obtain quotations from a number of solicitors, as there are no set fees. When you’ve found a property you wish to buy your solicitor will contact the seller’s solicitor and register your interest (the correspondence between solicitors is termed ‘missives’). Once the seller’s solicitor has had sufficient interest, he will usually fix a closing date by which time all offers must be submitted in writing.

Surveys

Before making an offer it’s vital that you have a valuation or survey done (and have the necessary finance), as once your offer in writing is accepted it’s legally binding. The main problem with the Scottish system is that each prospective buyer must have his own survey done before making an offer. This has prompted a proposed change in the law where the seller is responsible for having a survey carried out before selling a property – an excellent idea provided that the surveyor is legally responsible to both the vendor and buyer for any errors he makes.

Making an Offer

Most property is advertised as ‘offers above a certain price’, e.g. offers above £150,000, which is called the ‘upset’ price. Asking prices may be set artificially low to attract interest and they’re often exceeded by up to 30 per cent or more in popular areas and by around 5 to 10 per cent in less popular areas. It can be difficult to know where to pitch an offer as you don’t want to lose a property for the sake of a few hundred or thousand pounds, but you also don’t want to grossly overbid. You should discuss an offer with your solicitor and pitch it slightly above a round figure, e.g. £155,150 rather than £155,000.

Occasionally properties are advertised at a fixed price, when you must be quick off the mark as the first reasonable offer is accepted (this is also the normal procedure when buying a new home from a builder or developer). If the seller gives a closing date for offers, all interested parties must make sealed bids, which are opened on that date. The seller normally accepts the highest bid, although he isn’t legally bound to do so and can reject all offers, although this rarely happens. If the vendor wants a quick sale and you can complete almost immediately – the entry date is included in the offer – your lower offer could be accepted (so make a point of it if you’re a cash buyer).

It’s virtually impossible to be gazumped in Scotland, as once an offer in writing has been accepted it’s legally binding and you cannot pull out. Therefore it’s vital that you have a valuation or survey done (and have the necessary finance) before making an offer. If your offer is unsuccessful, you will have wasted time and money (on a survey) and you may have to do this a number of times before you’re successful!

You must not make an offer without your lender’s approval, otherwise you could find yourself legally committed to buying a property without the necessary finance!

After your offer is accepted a formal moving in date is set which makes it easier to co-ordinate a sale and purchase, and removes some of the problems of being in a chain. Once an offer has been accepted and the missives (contracts) concluded, you’re responsible for insuring the property.

Conveyancing & Completion

In Scotland, conveyancing is carried out after an offer has been accepted, when your solicitor or conveyancer examines the deeds and initiates proceedings towards settlement (completion), which is usually four to five weeks after acceptance of an offer. On completion day, settlement takes place whereby the solicitors acting for the two parties meet and exchange a cheque for the keys. After completion, you pay your solicitor’s fees, stamp duty and registration fees for the disposition (the legal document that transfers ownership), which is registered with the General Register of Sasines or the Land Register of Scotland (depending on the area).

© Survival Books Limited 2005

“Buying, Selling & Letting Property” 2nd Edition, David Hampshire.
Reproduced with the permission of Survival Books Limited.

Further information on this topic can be found in “Buying, Selling & Letting Property” 2nd edition, by David Hampshire.

For extensive, annually updated information about buying, selling and letting property, you can purchase this book at www.survivalbooks.net

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