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.
- Despite forecasts by many analysts that house prices would fall, house prices are still on the up! Gov.UK reports that the average price of a house in the UK currently stands at £286,000. According to data collected as of May 2023, the price of property has risen by 1.9% in comparison to the same time last year.
- Brits are continuing to pinch their pockets this year, as the cost-of-living crisis presses on. In fact, EY has forecast the country will remain in recession into summer 2023 with some effects potentially continuing into 2024. But PwC predicts a general return to trend growth rates at the back end of next year.
- Mortgage rates are expected to increase throughout 2023, with mortgage payments for first-time buyers potentially comprising of up to 60% of their net income. This is the case generally across a variety of UK regions making it a difficult time to enter the property market for those looking to buy. According to Rightmove’s mortgage monitor, a five-year fixed rate deal at 85% loan-to-value rose by 0.49 percentage points merely between July and August of this year.
- Renting remains difficult for many – especially in the nation’s capital – due to soaring prices. In part this has been attributed to investment from abroad, with overseas buyers snapping up apartments and townhouses as investments guaranteed to make a profit. Many of these properties are reportedly kept empty after purchase, making this trend doubly contentious in the current housing climate. A leading property website, Savills, unsurprisingly confirmed that of all UK regions London saw the greatest annual rental growth in the past year, with the figure standing at 14.2%. However, when taking a slightly broader view, London’s annual growth does not keep up with the UK average. The average rental increase in the UK is 21.5%, with the sharpest increases experienced in Wales and the North West of England, with growth rates of 27% and 24.7% respectively.
- Social change is creating interest in alternative investment opportunities. The UK's ageing population, for example, makes the retirement living sector a good bet. Student accommodation has also attracted investors due to the numbers of international students coming to the UK.
- With the cost of living soaring across the UK, it’s only expected that the number of people sleeping rough in the country will rise. According to The Big Issue, the cost of living crisis has exacerbated homelessness throughout the nation’s capital. For instance, 3,107 people were identified sleeping on London’s streets merely within the first quarter of 2023. The figure reported stands at 14% greater than what it was merely a year ago.
- According to real estate agents, Savills, it’s estimated that the most drastic falls in house prices for 2023 are likely to be in London and the neighbouring South East with overall figures decreasing by 11 and 12.5%. This contrasts to other regions within the UK where the fall is not quite so sharp. Savills forecasts that house prices in the North West, the North East and Yorkshire will decrease by only 8.5% on average.
- Savills also noted the degree of positivity currently sweeping the UK hotel sector as we make our way through 2023. A bounce in transaction volume is expected as institutional demand and fresh capital in the ground lease space is no longer repressed as it was throughout last year’s rough time concerning global capital markets. Sustainability remains a huge focus within the sector too, as investors seek sustainable opportunities with ESG at the heart of investments.