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John
Durrant - Estate Agent
The Government appears determined to improve England and Wales’ system for selling residential property. It has already published a White Paper and carried out a survey of several hundreds of transactions in order to identify the issues that can cause transactions to fail.
The survey suggested that delays in transactions could be a main cause of failure. As a result, there have been a number of proposals made that will, it is thought, help improve the success rate of transactions by helping to speed up the whole moving process.
One of the likely ways that the Government proposes to speed up the selling process is through legislation that will require sellers to complete most of the conveyancing/survey work that currently takes place between agreeing an offer and exchanging contracts, before the property is brought to the market. In other words, if the Government’s plans proceed, then once they become law no property will be able to be marketed until a surveyor has reported upon its condition and its title has been deduced by a conveyancer.
In practical terms, for leasehold property for example, this means that the seller will likely be obligated to produce a raft of documents such as management accounts, receipts for ground rent payments and property insurance details etc prior to marketing. Freehold properties will have to produce other relevant documentation such as permissions for extensions, copies of any guarantees that are claimed, details of easements, rights of way and so on.
Industry sources suggest that the new system will be operating by 2003, or perhaps 2002. The Government would like to see it up and running by 2001.
Estimates are that only 20% of houses currently sold are structurally surveyed. The new regulations will, therefore, result in a 400% increase in the number of structural surveys carried out annually. Presumably this means that more surveyors will have to be found from somewhere. One of the big questions is whether there will be the manpower to cope with the extra demands placed upon the surveying industry.
It has yet to be discovered how this system will work in practice and whether it will discourage people from wanting to put their homes onto the market where there is no strong reason for them to do so. Only time will tell how the market might react in the short term. In the medium to long term, given that everyone will move some day, it is to be hoped that the upheaval that will be caused to the market will make it all worth the effort.
A pilot scheme will be run in Bristol in 2000 and is likely to cover some 250 transactions to determine how well the scheme will work. However since the Government will be funding the pilot (paying for each individual transaction’s up-front costs), the true effect of introducing the scheme might have to wait until the Bill is passed into law and put into effect!
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