Updated 6 days ago

Whether you are moving to London now, or you have been living as an expat in England's capital city for some time already, you may have developed the desire to either settle in this outstanding city by becoming a house owner or to invest in a buy-to-let property. Either way, the steps toward purchasing real estate in London will require thorough research, guidance from a legal representative, and, of course, a substantial sum of money.

Before the purchase

Property in London is an attractive investment. However, before you invest your time (the process may take up to three months) and money in it, consider the reason for your purchase. Has London’s diverse, fun, and businesslike personality won your heart? Has the city become your second home? Or do you see real estate in London merely as an investment opportunity? Defining your goals will help you choose the right property.

Then, consider the area of your property. London’s outskirts are more affordable and houses there are spacious; however, travel time to central London is long, often not hassle-free, and expensive. For more information on London’s neighbourhoods, read our article Areas of London to help you decide which is the best location for your lifestyle.

 Important:

Even if you aren’t a first-time buyer, note that property purchase rules and regulations vary from one country to another.

It’s very important to understand the additional costs of your purchase, such as taxes. If you buy a home in England worth more than £300,000, you must pay Stamp Duty Land Tax (SDLT). If it’s not your first purchase, the tax applies to any property above £125,000.

Last but not least, create a payment plan and define the payment method(s) you will go with. For many, paying cash is an option, whereas for others the only way to become owners is to borrow money from the bank.

 Important:

You won’t be able to buy a home in London unless your residency status is in place.

The property purchase

Once you have made your offer to the seller (or their estate agent), they must draw up a legal contract, which will be transferring the ownership of the property to you.

 Attention:

No matter how much money you pay upfront and regardless of the discussions and promises between you and the seller or between your estate agents, no offer is legally binding until both sides have signed and exchanged the contracts. If you or the seller decides to pull out at a later stage, the other side is entitled to compensation.

The final steps are simple and include the emptying of the property and the departure of the previous tenants or owners, and the handover of the keys to you.

 Useful link:

Buying or selling your home

Key points about buy-to-let properties

  • Buy-to-let properties can bring a regular income.
  • Buy-to-let mortgages are usually more expensive than residential loans and require a higher deposit (25% or more).
  • The lender will evaluate how much money you will make from renting the property out in order to establish the amount they will lend you.
  • Before committing to a buy-to-let property, consider other ongoing costs such as maintenance, insurance, and agency fees.
We do our best to provide accurate and up to date information. However, if you have noticed any inaccuracies in this article, please let us know in the comments section below.