Purchase & Sale Flashcards
What is the sales process from start to finish?
a. Get instructed
b. Provide terms of business and do AML checks
c. Marketing period
d. Agree deal
e. Request deeds from Land Registry
f. Send draft contract to buyer’s solicitors
g. Receive enquiries from solicitors and reply if necessary
h. Buyer’s solicitors approve of contract
i. Send contract to client to sign
j. Receive completion date from buyer’s solicitors
k. Contracts exchanged
l. Receive a draft transfer for approval from buyer’s solicitors
m. Approve draft transfer
n. Send finalised transfer to client for signature
o. Completion occurs
How does location, specification, condition, size, outdoor space and parking impact valuations?
All to do with demand. Greater demand equals greater value
What are the four methods of sale?
a. Private Treaty – A property is marketed for no set period with no closing date
b. Formal Tender – Used by statutory bodies, with a blind bid process. Bid cannot be changed after submission. Essentially, sealed bids are opened at a set date
c. Informal Tender – Used when there is a good level of interest in the property or when negotiations need to be bought to a close after marketing via private treaty, and best bids are not legally binding. Either party can withdraw
d. Auction – Where sale takes place at auction on a set date
What are the pros and cons of each method of sale?
a. Private Treaty – Flexible, parties control the process, confidential and vendor not under obligation to sell. Can be gazumped as a buyer, buyer/seller can pull out
b. Formal Tender – Vender has choice to accept offer of their choice. Bids cannot be changed after submission. Speeds up the process to exchange of contracts
c. Informal Tender – Vender has choice to accept offer of their choice and they can pull out. Buyer can also pull out
d. Auction – short timetable and more certainty of sale. Costs to promote, vendor can’t choose purchaser and lack of price confidentiality
Describe the flat being sold in Chelsea?
a. 1 bed 1 bath with a small balcony
b. £720,000
c. Victorian build
d. Solid brick wall header style bricks
What is the title and demise of a property?
a. Title deeds are documents which prove ownership of a property and the history of its ownership. It includes a property description, names of current and previous owners and any restrictions or easements
b. Demised premises refer to premises that have been transferred by lease
What AML checks did you run?
a. Proof of ownership
b. Proof of ID
What is the sales memoranda?
a. A written evidence that an offer has been accepted, as well a record of the amount of money that will be paid
b. It is a contract, but not legally binding
What were the relevant searches and enquiries?
a. Not sure that was between the solicitors
b. Searches and enquiries are questions to gather more info about the property – eg what direction does the garden face
Tell me about the RICS UK Residential Real Estate Agency Professional Statement 2017?
a. Mandatory professional statement
b. Provides summary of code of practice in all aspects of property marketing for residential property
c. Comprises the following material relating to residential agency matters:
i. Relevant estate agency legislation
ii. Standards and ethics
iii. Before securing instructions
iv. Property marketing
v. Acting for the vendor, purchaser and landlord
vi. Ending the instruction
- Tell me about the Estate Agents Act 1979?
a. The Estate Agents Act 1979 applies to:
i. The disposal or acquisition of an interest in land
ii. Freehold property
iii. Leasehold property with a capital value
iv. Land as well as buildings
b. It has SEVEN key principles:
i. Clarity as to the terms of the agency
ii. Honest and accuracy
iii. Agreement and liability for costs
iv. Openness regarding personal interests
v. Absence of discrimination
vi. Legal obligation to tell the client about offers received
vii. Follow RICS rules re client money handling – KEEP IT SEPARATE
What is the current rate of stamp duty?
a. Only applies to property over £250,000
b. The portion from £250,001 - £925,000 = 5%
c. The portion from 925,001 to £1.5m = 10%
d. The portion from £1.5m and above = 12%
e. No stamp duty up to £425,000 for FTBs
Do stamp duty rates change if you’re already a property owner?
a. 3% on top of the rates
b. If you have sold before buying this won’t be added on
c. But if you legally own 2 properties at the time, you will have to pay the extra charge
Do stamp duty rates change for non-UK residents?
a. To be a UK resident for stamp duty purposes you have to spend 183 days (6 months) during the 12 months before you purchase in the UK
b. If you’re not a resident, you pay a 2% surcharge for buying in England
What was the stamp duty rate at the time of your sale?
Same as above, the rates changed to the above in September 2022
