How much does it cost to buy a dental practice?
The short version
- The biggest cost is the purchase price, most of which is goodwill valued on a multiple of profit, not just the building.
- On top of the price, budget for legal, accountancy, valuation, lender and due-diligence costs, plus working capital for the first months.
- Smaller squat or associate-led practices cost far less than large mixed or private practices, so any single figure is only a starting point.
- We arrange the funding and are an arranger and introducer, not a lender.
There is no single price for a dental practice, because price tracks profit, location and income mix. What we can do is break the cost into its parts so you can build a realistic budget before you offer, and so your finance is sized correctly from the start.
This guide sits under our pillar on financing a dental practice. For the deposit specifically, see the sibling guide linked below.
The purchase price: goodwill plus assets
The purchase price is built mostly from goodwill, the value of an established, profitable business, plus the value of equipment and fixtures, and the property where it is owned freehold. Goodwill is the part driven by profit, and it is usually the largest line.
Because the price flexes with profit, two practices with similar turnover can be worth very different amounts. To model the monthly repayment for any price you are considering, our commercial mortgage repayment calculator is the quickest check.
The costs on top of the price
The price is not the whole budget. A buyer also funds the transaction costs and the cost of getting the practice running under new ownership. These are smaller than the price but they are real cash and they often come due before any income arrives.
| Cost | What it covers | When it falls due |
|---|---|---|
| Legal fees | Solicitor for the purchase, NHS novation and lease | Through the deal |
| Accountancy | Due diligence on the accounts and tax structuring | Before and at completion |
| Valuation and survey | Lender valuation of goodwill and any property | Early in the process |
| Lender and arrangement | Facility set-up costs | At completion |
| Stamp duty | On any property element, where applicable | At completion |
| Working capital | Wages, lab bills and stock for the first months | From day one |
What makes one practice cost more than another
Profit is the main driver, but several factors push the number up or down. Understanding them helps you judge whether an asking price is fair before you pay for full due diligence.
Income mix
Practices with a strong private element often attract higher multiples than purely NHS ones.
Location
Demand, demographics and competition in the catchment area.
Size and condition
Number of surgeries, the state of the fit-out and equipment, and capacity to grow.
Patient base and reputation
A loyal, well-recorded patient list supports the goodwill.
How the cost is usually funded
Most buyers fund a practice with a deposit plus a term loan, and sometimes asset finance for equipment. The split depends on the lender, the practice and your earning record. The valuation method, including how goodwill is treated for lending, is covered in our valuation and goodwill finance guide.
The price tells you what to pay. The funding structure tells you what it costs you each month, and that is the number that decides whether the deal works.
We arrange the structure across banks and specialist healthcare funders. Start with our dental practice finance page, and see the sibling guide on how much deposit you need.