Costs incurred in selling jointly-owned property

Letterpaint

I'm looking for opinions please.  I currently own a second property 50-50 with another member of my family.  They want to sell their half to myself so they can gain cash funds.  We've both obtained quotes from separate solicitors to perform each side of the transfer ... the quote I've received (as the buyer) is about x6 higher than the other quote on the seller's side.  This is mainly because of the Stamp Duty.

Therefore my question is: is it reasonable for me to think we should split the sum of all costs equally between us, as opposed to myself having to pay the majority?   

I'd be interested to know what anyone thinks.   Or has anyone previously found themselves in the same situation and what was agreed?

tacpot12

There is also extra work in registering the title that falls to the buyer's solicitor. 

As they want you to buy them out, it is entirely reasonable that the costs of the sale are split equally, including the tax. They can't get their money if you don't pay tax, and as they are driving the sale, it's not fair to expect you to pay all the tax due. A 50/50 split of costs and tax seems fair under the circumstances.

EssexHebridean

Take out the stamp duty and registration costs etc from the quote, then compare the actual legal costs - they will probably not be all that different.

As the buyer, you will obviously be liable for the stamp duty and the cost of registering the title into your name only. 

_Penny_Dreadful

Letterpaint said:

I'm looking for opinions please.  I currently own a second property 50-50 with another member of my family.  They want to sell their half to myself so they can gain cash funds.  We've both obtained quotes from separate solicitors to perform each side of the transfer ... the quote I've received (as the buyer) is about x6 higher than the other quote on the seller's side.  This is mainly because of the Stamp Duty.

Therefore my question is: is it reasonable for me to think we should split the sum of all costs equally between us, as opposed to myself having to pay the majority?   

I'd be interested to know what anyone thinks.   Or has anyone previously found themselves in the same situation and what was agreed?

I don't think a 50/50 split is reasonable.  SDLT is paid when you purchase property and your family member is not purchasing property by selling it so that is your cost to bear alone.  As for the solicitors fees , you chose the solicitor so if their fees are higher than those of your family member's solicitor then that is on you. 

loubel

You paying your legal fees and your relative paying theirs seems fair to me. 

propertyrental

Do you need solicitors? Are mortgage(s) involved? Do you trust each other?

Do you want to buy the other 50% or are you doing so just to benefit the family member? If you are doing this as a favour, then it's fair enough to ask them to contribute towards your costs.

If you actually want to own 100%, then normal rules apply: buyer pays SDLT and searches etc, but by all means shop around for a competitive conveyancer.

saajan_12

I'd separate tax and other costs.
Costs:
IF you have a mortgage then you'll need the full solicitor costs, searches, surveys, mortgage application, etc. 

If not, then given you already own half the property, presumably you already know the issues and are happy to own all of it? Then you may just need someone to transfer the title - cost in the order of £100s rather than £1000s. 

Tax:
Stamp duty tax is due on any purchase of assets including property. Arguably you're acquiring more assets than you had before ,so more potential for capital appreciation, etc, so you should pay the stamp duty. On the other hand if you're essentially switching other assets for property for the benefit of your friend only, then maybe they can contribute. 

sheramber

Does this family member live in the house or will they be due to pay CGT ?