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.
- 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, so values drop and conventional bank lending becomes increasingly hard to find.
- Despite the Covid-19 pandemic continuing to loom over us, we've seen recent market activity that has bucked the trend for recession conditions: the UK’s housing market has in fact been performing well. The March lockdown prompted several predictions of a fall in house prices, but the unusually busy summer season saw a continuity in rising prices and activity. The Financial Times reported stats from both Zoopla and Nationwide that respectively showed that in August 2020 sales were 76% above their five-year average and that UK house prices were at an all time high for that month. So why are we witnessing this boom? Well, the property market's short-term immunity has been created by mortgage payment and stamp duty holidays as well as furlough schemes and bans on repossession. But the negative impact won’t be on standby for long.
- Once these measures are removed, the Centre for Economic and Business Research (CEBR) has reported that house prices will drop by around 14% by early 2021. However, chancellor Sunak’s £3.8 billion stamp duty holiday is due to come to an end in March 2021, so we may see a short-term rise for those rushing to benefit from the reduction. CEBR’s analysis nonetheless suggests that “average house prices are forecast to be 13.8% lower in 2021 than in 2020.”
- The Big Smoke seems to be the only place in the UK which has resisted the impact of the stamp duty reduction. Not even Rishi Sunak can battle those high prices in the capital!
- Brexit's effect on the property market is dependent on the effect it has on the economy as a whole. The housing market is mainly influenced by wages and interest rates, and a large number of economists expect that Brexit will suppress wages. But the actual effects of Britain's exit from the EU will depend on how the negotiations go.
- Renting still 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.
- Unaffordable housing and a national housing crisis are contributing factors to the nation’s increasing homelessness figures. Figures from the Department for Communities and Local Government show that the number of rough sleepers is exponentially rising across the UK.
- Renters affected by Covid-19 will continue to receive support from the government throughout the harsh winter. Housing secretary Rt Hon Robert Jenrick MP has stated that evictions have been banned for six months. In addition, £180 million has been set aside for Discretionary Housing Payments for local authorities to support renters who are struggling financially. Bailiffs have also had restrictions placed on conducting evictions in areas where a local lockdown is enforced.
- 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. If a no-deal Brexit occurs, Jonathan Harris of mortgage broker Forensic Property Finance says: “Logic suggests that a fall in sterling would bring an uptick in overseas buyers.”