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Selling a property in England and buying in Scotland: what is a good and safe home for the £500k involved?

by magicol 16 February 2010 |

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House purchase rules in Scotland mean that an offer on a property is binding so it is too risky to rely on capital from a sale in England until completion. We will therefore have around £500K requiring a safe but hopefully brief home for anything from 6 weeks to 6 months until we find and buy a property in Scotland. We have temporary accommodation to see us over this period. We may need immediate access to the money to seal the deal but want a reasonable return if the purchase is protracted. Any suggestions?

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804

MikeGG1 posted
Try the Coventry BS 1st Class Postal A/c @3.15%.
The maximum is £250k but if there are two of you you can open one each.
http://www.coventrybuildingsociety.co.uk/savings/postal.aspx
Mike
Posted on 16 February 2010 | Love 0 loves Report
272

Swarbs posted
The only place the money will be truly safe is with National Savings and Investments - all banks will only be covered up to £50,000 (£100,000 for a joint account). Unfortunately NS&I only offer interest rates of 0.7% on their instant access savings account, so that doesn't really give you a great return.
Another option is to open five easy access savings accounts with five different banks in joint names, and stick £100,000 in each of them, to keep FSCS protection. Just make sure you choose banks which are completely separate and not part of the same group (don't do both Halifax and Bank of Scotland for example).
Finally, you could put all £500,000 in an account with Northern Rock or Royal Bank of Scotland. As these are owned by the government they should be safe as NS&I at least for the next year, and you are likely to get a better return. But then there is still a small chance of them failing, particularly if government funding is withdrawn, so they are not 100% safe.
Posted on 16 February 2010 | Love 1 love Report
134

liesarenocomfort posted
I'm sure you weren't, but if you had a fleeting idea that leaving the funds in the the English solicitor's client account would be safe... it isn't. Client funds are only guaranteed up to £50k for each client if the client account bank falls over (assuming client didn't have other accounts with client account bank -in which case tha maximum is £50k).

Posted on 17 February 2010 | Love 1 love Report
410

manzanilla posted
Northern Rock is 100% guaranateed by the Treasury at the moment (which RBS is not) and you can get 2.5% on instant access.
The government guarantee may be withdrawn over the next 6 months, but this will be flagged up clearly and you should have at least a month's notice to sort out somewhere then for the money.
I would stick £100k in a joint account with the Coventry BS that Mike has mentioned and put the rest in N Rock. Better safe than sorry with your financial future.
manzanilla
Posted on 17 February 2010 | Love 1 love Report
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magicol posted
Thank you all, for the good advice and taking time to post your comments. They are helpful and appreciated.
Posted on 19 February 2010 | Love 0 loves Report

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