Property/Real Estate

In a nutshell

Property lawyers, like their corporate colleagues, are essentially transactional lawyers; the only real difference is that real estate deals require an extra layer of specialist legal and procedural knowledge and there aren’t quite so many pesky regulatory authorities. The work centres on buildings and land of all types, and even the most oblique legal concepts have a bricks-and-mortar or human basis to them. It is common for lawyers to develop a specialism within this field, such as residential conveyancing, mortgage lending and property finance, social housing or the leisure and hotels sector. Most firms have a property department, and the larger the department the more likely the lawyers are to specialise. Note that ‘property’ and ‘real estate’ are entirely interchangeable terms.

 

What lawyers do

  • Negotiate sales, purchases and leases of land and buildings and advise on the structure of deals.
  • Record the terms of an agreement in legal documents.
  • Gather and analyse factual information about properties from the owners, surveyors, local authorities and the Land Registry.
  • Prepare reports for buyers and anyone lending money.
  • Manage the transfer of money and the handover of properties to new owners or occupiers.
  • Take the appropriate steps to register new owners and protect the interests of lenders or investors.
  • Advise clients on their responsibilities in leasehold relationships and on how to take action if problems arise.
  • Help developers get all the necessary permissions to build, alter or change the permitted use of properties.
  • Manage property portfolio investments and advise real estate funds.

Realities of the job

  • Property lawyers have to multi-task. A single deal could involve many hundreds of properties, and your caseload could contain scores of files, all at different stages in the process. You’ll have to keep organised.
  • Good drafting skills require attention to detail and careful thought. Plus you need to keep up to date with industry trends and standards.
  • Some clients get antsy; you have to be able to explain legal problems in lay terms.
  • Despite some site visits, this is mainly a desk job with a lot of time spent on the phone to other solicitors, estate agents, civil servants and consultants.
  • Most instances of solicitor negligence occur in this area of practice. There is so much that can go wrong.
  • Property departments are known for offering trainees plenty of independent responsibility: often you'll be dealing with 20 or 30 small property files (sales, leases, licences to assign) at the same time.
  • Your days will be busy, but generally the hours are more sociable and predictable than in other transactional practices.

Current issues

  • Arguably the most cyclical legal area around, property practice has always followed and will always follow the market. In an economic downturn, especially a global one, there’s less demand for properties and new developments, values plummet and conventional bank lending becomes increasingly hard to find. Conversely, in good times the property sector and the fortunes of property lawyers boom.
  • In recent years, the UK property market, especially London, has been driven forward by investment from abroad, with overseas buyers snapping up luxury apartments and townhouses as investments guaranteed to make a profit. Many of these properties are kept empty after purchase, making this trend doubly contentious in the current housing climate.
  • Growth in the property market began to slow towards the end of 2015, while uncertainty in the build up to the EU referendum led to a more noticeable drop in activity in 2016. The weeks after the referendum saw numerous private buyers pull out of deals, major property funds suspended their trading and general investment funds offloaded their property assets. The market has since started to show signs of recovery as domestic first-time buyers and foreign investors took advantage of falling house prices and the decreasing value of the pound.
  • The increasing price of residential property over the last couple of years is more closely linked to demand than supply, according to research by Fathom Consulting. Cheap loans and the popularity of the government's Help-to-Buy policy have opened up the market to more first time buyers, increasing demand and pushing up property prices. The average UK house price is now 6.1 times greater than the average earnings and home ownership in England has fallen to its lowest level in 30 years. London's not the only area affected by the slump; home ownership fell in Leeds, Sheffield and the West Midlands though the greatest drop occurred in Manchester.
  • A new market of crowdfunded property owners has emerged as people club together to purchase buy-to-let properties. The process allows buyers to get a foot on the property ladder with far smaller sums of cash; would-be owners could only need to stump up a mere £50 to get their hands on a share of the property. If the method proves popular, an increase in buyers could further drive up housing prices.
  • Social change is creating interest in alternative investment opportunities. The UK's ageing population, for example, makes retirement living and the healthcare sector a good bet. Student accommodation has also attracted investors in recent years due to large numbers of EU and international students coming to the UK but it remains to be seen how much of an impact the Brexit vote will have on this particular market.