Buying commercial property in Scotland
Ultimate Guide to commercial purchase Scotland
October 7, 2018 Commercial Conveyancing
A commercial property purchase provides business flexibility and the freedom to tailor the premises to specific business needs and development.
When contemplating purchasing commercial properties, you should consider financial and legal aspects, including commercial mortgages. Assess if the business can comfortably meet monthly repayment costs over a shorter period.
When thinking about a commercial purchase, it’s beneficial to assess both the potential advantages and disadvantages:
Buying a property might be time-consuming, especially if significant alterations are necessary to meet your business requirements. This might be challenging, especially if you’re on a tight schedule for a quick relocation.
If you secured a mortgage for the purchase of the premises, this would of course commit you and your business to on-going costs such as business rates.
Commercial purchases require substantial capital, limiting investment potential in your business. Rapid capital recovery might be challenging for some businesses.
There is potential of negative equity or even repossession if you will not be in a position to keep up with the repayments of the mortgage.
Acquiring a commercial property comes with added responsibility for health and safety regulations. This means being actively aware of and staying up-to-date with requirements, fire precautions, and other responsibilities tied to maintaining a safe environment.
A commercial purchase incurs various costs such as solicitor fees, surveyor fees, and expenses for alterations and repairs.
Considering the substantial ongoing costs, it’s essential to think about hiring a surveyor to assess the value and structure of the premises. The survey provides crucial information to help you determine if the purchase is suitable.
It is also good practice to get a survey in order to ensure that you have all the necessary information about the property and consequently avoid any surprises at a later stage.
If you are using a mortgage lender, they might wish for a survey to be carried out so that they can be assured that the premises are appropriate and that there is nothing that might affect the mortgage repayments in the future.
Your surveyor could potentially assist you with deciding whether the premises are suitable, advise you whether you might want to improve or alter the building and in some circumstances even negotiate the right insurance cover.
Surveyor fees vary based on premises price and other factors. It’s best to select a surveyor offering a fixed-cost survey. Numerous surveyors in Scotland can provide detailed cost breakdowns. Your solicitor can recommend surveyors they’ve worked with before.
Selecting the Ideal Commercial Property Lawyer
Selecting the right solicitor is crucial for navigating the complexity of commercial property purchases. Select a specialist in commercial property law with the necessary experience. Your solicitor will guide you through the purchase, verifying the seller’s title and conducting necessary checks to ensure property ownership is in order, promptly notifying you of any issues.
Your solicitor will also work towards ensuring that they will negotiate the best deal for you in terms of the contract.
Considering the importance of timing, your solicitor will work efficiently to promptly conclude the purchase and avoid potential delays.
When choosing a solicitor, discuss their experience and fees, including a breakdown of costs like Stamp Duty Land Tax and registration fees. Aim for a fixed fee when possible for clarity and peace of mind about the total costs.
Before making an offer, confirm your satisfaction with the property price and its inclusions. Consult your solicitor for a clear understanding of the purchase details. Your solicitor will submit an offer to the agent, typically specifying conditions like securing finances, obtaining planning permission for alterations, and a satisfactory building survey.
The vendor might accept your offer or decline it or perhaps negotiate with you in respect of the purchase price or other points.
Once both parties agree on the contract terms, all checks are complete, and funds are secured, your solicitor will finalise the contract on your behalf.
After the contract is finalised, it becomes legally binding. On the completion date, your solicitor will transfer purchase funds to the seller’s solicitor, who will then provide the necessary documents for registration with the Register of Scotland. Your solicitor will manage the documentation to transfer property ownership to your name
If you are thinking about a obtaining a commercial purchase, it is crucial to obtain legal advice at an early stage. Our highly experienced team of commercial property lawyers will provide you with clear and concise advice and guide you through the legal process.
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