Study Notes · 74 sections
Property transactions are among the most important matters you will handle as a solicitor. For most people, buying a home is the biggest financial commitment of their lives. They are trusting you with their life savings and their future. Get it wrong, and the consequences can be devastating. Get it right, and you help make dreams come true.
Property law appears throughout SQE1 and SQE2. Understanding the basics now will help you with everything from landlord and tenant disputes to wills and estates. Master these foundations, and the rest will follow.
Conveyancing is the legal process of transferring property ownership from one person to another. The word comes from "convey" - to transfer or pass something to another. As a solicitor, you are the guide who takes your client through this journey, protecting their interests every step of the way.
You will be involved from start to finish: taking instructions, investigating title, raising enquiries, negotiating contracts, handling completion, and dealing with post-completion formalities. You are the project manager of the transaction, coordinating everyone involved and keeping things moving forward.
At its core, a property transaction involves a buyer and a seller. In property law, we call them the "purchaser" and the "vendor". These are the terms you will see in contracts and formal documents. But in practice, we just say buyer and seller - it is clearer and less old-fashioned.
Most transactions involve more than just the buyer and seller. You will work alongside estate agents, surveyors, mortgage brokers, and other professionals. Each has a role to play, and understanding who does what will help you coordinate everything smoothly.
| Party | Role | Key Responsibilities |
|---|---|---|
| Buyer/Purchaser | The person buying the property | Pays the purchase price, provides funds, takes ownership |
| Seller/Vendor | The person selling the property | Provides good title, answers enquiries, moves out |
| Buyer's Solicitor | Acting for the buyer | Investigates title, raises enquiries, protects buyer's interests |
| Seller's Solicitor | Acting for the seller | Provides title information, answers enquiries, prepares contract |
| Estate Agent | Marketing the property | Introduces parties, negotiates price, facilitates viewings |
| Surveyor | Inspecting the property | Identifies defects, values the property for the lender |
| Mortgage Broker | Arranging finance | Finds the best mortgage deal, handles lender applications |
Your client will look to you for guidance on everything. You are the expert, but you are also part of a team. Keep everyone informed, respond promptly to enquiries, and be proactive in solving problems. A good solicitor makes the whole process feel effortless to the client.
A property transaction moves through five distinct stages. Understanding these stages, and what happens at each point, is essential for managing expectations and spotting potential problems before they become critical.
Most residential transactions take 8-12 weeks from instructions to completion. Simple cases might be quicker. Complex cases can take much longer. The timeline depends on the length of the chain, how efficient the other solicitor is, whether there are mortgage issues, and whether any problems emerge from searches or enquiries.
Exchange of contracts is the point of no return. Once exchanged, your client is legally committed to buy. If they pull out, they lose their deposit and could be sued for damages. Never exchange until your client has funds confirmed, mortgage offer in hand, and all enquiries satisfactorily answered.
The pre-contract stage is all about information gathering and due diligence. You need to find out everything you can about the property and the seller's title before your client commits. This is when you uncover problems that might cause your client to walk away.
The seller's solicitor prepares the draft contract. This is based on standard conditions but will include special conditions specific to the property. You will review the contract, raise enquiries about anything unclear, and negotiate amendments if needed.
Enquiries are questions you ask the seller about the property. The seller must answer truthfully. Typical enquiries cover: fixtures and fittings included in the sale, disputes with neighbours, modifications to the property, and any notices or proposals affecting the property.
Exchange is the moment when the transaction becomes legally binding. Both parties sign identical contracts, and the solicitors exchange them. A deposit is paid (usually 10% of the purchase price). From this point, neither side can withdraw without serious consequences.
Once contracts are exchanged, the seller must sell and the buyer must buy. The completion date is fixed. The buyer owns an equitable interest in the property. The seller receives the deposit as security. The price is fixed and cannot be changed. It is a binding commitment for both sides.
A contract for the sale or other disposition of an interest in land must be in writing and signed by or on behalf of each party.
Make sure your client understands: once exchange happens, there is no going back. If they change their mind, they lose their deposit and may be liable for the seller's additional costs. Be absolutely certain before you exchange.
The period between exchange and completion usually lasts 1-4 weeks. This is when final preparations are made. Completion day is fixed in the contract, and everything must be ready for that date. Your job is to ensure nothing gets in the way of a smooth completion.
Just before completion, you carry out priority searches to check nothing has changed since you last checked. This includes a bankruptcy search against the other side, and a final land charges search. These are done shortly before completion to ensure there are no surprises.
The transfer deed (called a TR1) is the document that actually transfers legal ownership from seller to buyer. It is prepared in draft form and approved by both sides. It must be signed as a deed before completion - which means it must be witnessed.
Completion is when ownership actually transfers. All the money is paid, the transfer deed is handed over, and the buyer gets the keys. From this moment, the buyer is the legal owner of the property. The seller must move out, and the buyer can move in.
Traditionally, completion involved meeting in person to exchange documents and cheques. Today, most completions are electronic. Funds are transferred electronically between solicitors' client accounts, and documents are exchanged by email. Physical completion still happens for some transactions, but it is increasingly rare.
The "key handover" is symbolic but important. The buyer cannot usually get keys until the seller's solicitor confirms they have received all the money. Once funds arrive, keys are released (usually via the estate agent), and the buyer can access the property.
On completion morning, stay in close contact with the other solicitor. Make sure your client knows to have funds cleared in your account. Confirm when keys will be released. A smooth completion is a thing of beauty when everything comes together at the right time.
The transaction may be complete, but your work is not done. There are essential post-completion tasks that must be handled promptly. Your client now owns the property, but you need to make sure that ownership is properly registered and all taxes are paid.
Stamp Duty Land Tax (SDLT) must be paid to HMRC within 14 days of completion. The return is filed electronically. You will need to calculate the tax, file the return, and ensure payment is made on time. Late payment attracts interest and penalties.
The transfer must be registered with HM Land Registry to update the register. This confirms your client as the new legal owner. Registration can take several weeks, and until it is complete, your client's ownership is not formally recorded. This is a crucial final step.
The Law Society Conveyancing Protocol is a set of best practice guidelines for residential property transactions. It standardises procedures, sets out timetables, and promotes efficiency. Following the Protocol makes transactions smoother and less likely to encounter delays.
The Protocol applies to most residential freehold transactions. It can be used for leasehold transactions too, with some modifications. Parties can agree to follow the Protocol, and many lenders require it. It is not compulsory, but it is widely used in practice.
The Protocol sets out specific actions that should happen at each stage, with target timescales. For example, it says how quickly enquiries should be answered, when searches should be ordered, and how long exchange should take after mortgage offer is received. Following these timescales keeps things moving.
The Protocol provides a framework for efficient residential conveyancing, setting out stages and timetables for the transaction.
Even if the other side does not want to follow the Protocol, you should still aim to meet its timetables. It protects your client, promotes efficiency, and shows you are acting professionally. Most experienced solicitors follow it as a matter of course.
Freehold means you own the property outright - the building and the land it stands on. You own it forever (or "in fee simple absolute" in legal terms). There is no landlord, no ground rent, and no time limit on your ownership. You can pass it on to your heirs when you die. This is the gold standard of property ownership.
Leasehold means you own the property only for a fixed period of time - the lease term. Someone else (the freeholder or landlord) owns the land. You usually pay ground rent and possibly service charges. When the lease ends, ownership returns to the landlord. Most flats are leasehold, and some houses are too.
| Feature | Freehold | Leasehold |
|---|---|---|
| Ownership Duration | Forever (indefinite) | Fixed term (e.g., 99 years, 999 years) |
| Ground Rent | None | Usually payable annually |
| Service Charge | None (you arrange your own maintenance) | Usually payable for maintenance of shared areas |
| Landlord | No landlord | Freeholder is landlord |
| Control over Property | Complete control | Restricted by lease terms |
| Responsibilities | Responsible for all repairs | Landlord may be responsible for structure and exterior |
| Value at End | Property retains value (usually) | Value decreases as lease term shortens |
Freehold is generally preferred because it gives complete ownership without time limits or landlord interference. Leasehold properties with short leases can be difficult to mortgage and sell. That said, many flats are leasehold by necessity, and long leases (over 80 years) are similar to freehold in practice.
When you receive instructions, check immediately whether the property is freehold or leasehold. This affects everything: the contract you use, the enquiries you raise, the searches you need, and the advice you give. Leasehold transactions are more complex and take longer.
Your relationship with a client begins with clear terms of engagement. This is a formal document setting out what you will do, what it will cost, and how long it will take. It protects both you and the client by managing expectations from the start.
A good client care letter explains the process, outlines costs, highlights key risks, and sets out timescales. It should be in plain English - not legal jargon. Your client should understand what will happen, when it will happen, and what it will cost.
You must give your client a realistic estimate of costs at the outset. This includes your fees, VAT, disbursements (searches, Land Registry fees, etc.), and any Stamp Duty Land Tax. If costs are likely to change, you should explain this upfront. Unexpected bills are a major source of complaints against solicitors.
It is professional misconduct to start substantive work without agreed terms of engagement. Get your terms signed and money on account (if required) before you begin. This protects you and ensures your client understands the arrangement.
Property transactions are a prime target for money launderers. Large sums changing hands, complex ownership structures, and the ability to move money internationally make property attractive for hiding illicit funds. As a solicitor, you are on the front line of anti-money laundering efforts.
Before acting, you must verify your client's identity. This means seeing original documents (passport, driving licence, utility bills) and checking they are genuine. For companies, you need to verify the company exists and check who really owns and controls it. This is not optional - it is a legal requirement.
It is not enough to know who your client is - you must also know where their money is coming from. Large deposits, gifts from family members, or funds from overseas require extra scrutiny. You need to see bank statements, evidence of savings, or explanations for wealth. If the source of funds is suspicious, you cannot proceed.
A relevant person must carry out customer due diligence measures when establishing a business relationship, including identifying the customer and verifying their identity.
If you fail to carry out proper client due diligence, or if you proceed when you have suspicions about money laundering, you commit a criminal offence. The penalties include prison and unlimited fines. When in doubt, make a Suspicious Activity Report (SAR) to the National Crime Agency. It is better to refuse instructions than to risk criminal liability.
Your fees will usually be based on time spent, but you should give a fixed estimate or quote where possible. Remember to include disbursements: search fees, Land Registry fees, bank transfer fees, and any third-party costs. VAT is added on top of your fees. Be clear about what is and is not included.
Be honest about how long things will take. A straightforward transaction might take 8 weeks. A transaction in a chain of three or four properties could take 16 weeks or more. The chain moves at the pace of the slowest transaction. If your client needs to complete quickly, explain what might need to happen to achieve that.
Delays come from everywhere: slow responses from the other solicitor, issues revealed by searches, problems with mortgage applications, chains breaking down, last-minute negotiations, and clients who change their minds. Build some buffer into your timescales, and keep your client informed if things are running late.
| Transaction Type | Typical Timeframe | Key Factors |
|---|---|---|
| Cash buyer, no chain | 4-6 weeks | No mortgage delays, straightforward |
| Mortgage buyer, no chain | 8-10 weeks | Mortgage application adds time |
| Chain of 2-3 properties | 10-14 weeks | Chain moves at slowest pace |
| Chain of 4+ properties | 12-20 weeks | More links = more potential delays |
| Leasehold property | 10-14 weeks | Additional enquiries and landlord consent needed |
If you think a transaction will take 10 weeks, tell your client 12-14 weeks. If you complete in 8, you are a hero. If you promise 8 weeks and take 12, you have failed to manage expectations. Better to surprise pleasantly than to disappoint.
Master these foundations and the rest of property law will make much more sense. Title investigation, searches, contracts, completion - these are the basics you will use in every property transaction. Understanding them now prepares you for more advanced topics ahead.