The Differences Between Buying and Selling Property in Scotland and England
21 March 2022
If you currently live in England. But are thinking of buying a property in Scotland, you may not know there are several differences in the home buying and selling processes between the two countries.
Scotland has a different legal system compared to England, and while many things are similar, there are many differences between the way the two systems work, especially when it comes to buying or selling property.
Preparing to sell a property in Scotland versus England
Selling a property in Scotland is a more in-depth process compared to in England, with sellers taking more responsibility and the financial burden for listing their home. Sellers will first engage a solicitor estate agent, who will handle both the marketing and conveyancing of the property. The solicitor estate agent will then commence work on the marketing of the property, arranging photography, video tour, online listing and property brochure (also known as a schedule).
They will then commission a Home Report, which is a legal requirement in Scotland. Properties cannot be listed for sale without a Home Report, these are paid for by the seller, and is made available to all who are interested in buying the property. The Home Report includes a property survey, an energy efficiency certificate and a detailed homeowner’s questionnaire, plus an estimated property valuation, so that buyers can discover lots of information about the property before they commit to it.
This process is very different to England, where sellers engage an estate agent who works on the marketing of the property, and will appoint a separate solicitor later, once they have accepted an offer on their home. The only legal requirement of a seller in England is to order an EPC certificate for their home, which confirms their property’s energy efficiency rating.
In England, if a buyer wants to know more in-depth information about the condition of a property, they can order a survey after their offer has been accepted. This means that a buyer may only find out concerning information about the property’s condition only after having their offer accepted, after which time they will need to decide whether to proceed with the purchase.
Marketing a property in Scotland versus England
Sellers generally use a solicitor estate agent in Scotland to sell their home – this means that the marketing and conveyancing is handled under one roof, which is generally quicker and more effective than in England, where sellers appoint separate estate agents and solicitors to handle different parts of the process.
In England, properties are listed on the market with a negotiable asking price. Sometimes this is listed as a price bracket that the seller finds acceptable, or a specific price, but it’s very common for a price to be negotiated between buyer and seller prior to agreeing, and buyers may frequently pay less than the listed price.
In Scotland, properties are generally placed on the market with either a fixed asking price or an ‘offers over’ asking price, where it is expected that the home will sell for anything up to 20% (sometimes more) above this price, depending on the market.
Making an offer on a property in Scotland versus England
The way buyers make an offer on a property is very different in Scotland compared to England.
In England, buyers can make their offer directly to the estate agent or even, in some cases, the owner and agree the price and any terms of the sale upfront.
Making an offer on a property in Scotland is different. Buyers must appoint a Scottish solicitor in order to make an offer. Once a solicitor has been appointed, the buyer can choose to note their interest in the property, which means they will be informed of any other offers or interested parties, or if a closing date is set.
Alternatively, buyers can make an offer without noting interest, but this will be made via their solicitor, who submits a formal written offer to the seller’s agent.
Closing dates are more common in Scotland, although ‘best and final’ bids are becoming more frequently used in England as well.
Stamp duty in Scotland versus England
Property tax applies in Scotland and England; however, they are different in nature and calculated differently depending on where you are buying a home.
In England, stamp duty (Stamp Duty Land Tax, or SDLT) applies to priorities priced at £125,000 and above, and increases proportionately to the value of the property, with different price bands in place.
Whereas in Scotland, SDLT was replaced in 2015 with LBTT (Land and Building Transaction Tax), which applies to residential and commercial property purchases. LBTT is designed so that the charge is proportionate to the price of the property, with different percentage rates for each price band. Properties priced at £145,000 and under are exempt from LBTT payments, but for first-time buyers, this is increased to £175,000.
The conveyancing process in Scotland versus England
The conveyancing process in England is commonly seen as more stressful compared to the system used in Scotland. Mostly due to it taking much longer for the agreed sale to be legally binding. In England, the exchange of contracts that makes a sale legally binding happens much closer to the completion of the sale, in most cases a week or two weeks before the moving date. Until contracts are exchanged, either party can withdraw from the sale without penalty – this means it is not unheard of for the whole property chains to fall through close to the sale date, meaning the process can often be fraught with worry.
Whereas in Scotland, instead of exchanging a single contract, solicitors will exchange a series of formal letters, known as ‘missives’. As soon as the missives are concluded, the sale becomes legally binding. Usually, this happens much sooner in the sales process, after which time the solicitor will finalise the legal work of transferring the property deeds to the new owner.
What happens if you’re selling in England and buying in Scotland, and vice-versa?
If you are selling a property in Scotland and buying a property in England, you will probably find the process less challenging than making the reverse journey. Once the missives have been concluded on the property sale in Scotland, the binding contract allows you to move forward and complete the purchase of the property in England.
However, it isn’t possible to sell in England and buy a home in Scotland in one single process. This is because the exchange of contracts doesn’t happen till much closer to the completion of the sale, meaning buyers won’t be able to move on with the purchase of the Scottish property until very late in the process.
When buying in Scotland or England, if you are selling in the other at the same time, is it worth noting that you will need to engage in the services of two solicitors to complete your property purchases – one familiar with English property law, and one with Scottish property law.