Shall we campaign for a different system of house buying/selling in England?(12 Posts)
ALL this angst and pain- and WHY?
MY proposal is based on the Queensland Australia model (the one I know!).
You like, you put in a WRITTEN offer complete with your terms and conditions (higher offer, more onerous terms; lower offer, easy terms etc!). PLUS a 'completion' date when all is done and dusted!! (30-60 days usually)
Owner comes back with HIS written counter 'offer' and and amendments to your terms if necessary. During this time the seller can entertain other offers.
Once agreement has been reached, the contract is signed, you pay a small deposit (£500?) and you have usually 10 days to a) cool off and b) get the searches and inspection done. The owner usually can't entertain any other offers at this stage.
If you either cool off or find an unexpected problem you either walk away with the return of your deposit OR renegotiate the price (and ditto walk away if a new price isn't mutually acceptable.)
At this point a substantial deposit is paid, perhaps 10% of the agreed price.
30-60 days (according to agreement) later you own the house. Full stop.
No chains, no either party walking away on 'completion day' (or if you do, you lose that huge deposit!- it's independently held), no gazumping or gazundering.
What's not to like?
People have said 'But what if the property I'm buying falls through?' Well, under THIS system it's very unlikely to because everyone is singing from the same hymn sheet! There ARE no chains to collapse, no gazumping offers made! And believe me, having 'x' days to get it all done (finding a new house for instance, searches etc) focuses everyone's mind!
What do you think?
Well, what holds up finance? People going in making offers they can't finance because they know they can walk away without penalty if the can't raise the cash?
Possibly that there are no time scales in place? The ability of a bank to change its terms and conditions after they've agreed to loan?
I'd agree the WHOLE kit and caboodle would need looking at (and legislating for!), banks, conveyancers, search facilities, estate agents but the reason it is SO MUCH less stressful in Oz is becasue everyone knows the rules! It's amazing how quick a search can be completed if there's a time frame and a resultant penalty in place, for instance!
I agree we need a better system than we currently have.
A friend of mine is moving to Sweden and made an offer on a house yesterday. The owners are moving out today and she will be able to take possession next week!
I don't get how this is supposed to ensure you have no chain?
A chain happens when one person's ability to complete is dictated by another person's readiness (or willingness!) on THEIR house. A has to happen before B and C.
In this proposed system, IF I'm selling for instance and have got a contract on a place I want to buy which 'completes' in 90 days, on Oct 1st, say, I would tell my potential buyer that and he would decide whether he wants to go ahead and buy mine with completion on October 1st, or sooner so I might have to consider renting OR even (what we did!) rent the house BACK off the new owner for a couple of weeks!
One can always put in a 'subject to sale of MY place' condition in the contract but of course you have to offer a higher price on a house you want to buy to compensate THEM for the risk they're taking though there'd always be an end date ie if I haven't sold by this date, the deal's off.
No system is foolproof of course but the advantage of THIS proposal is that everyone in it is SERIOUS. There can be no unpunished changing of minds, upping or downing of prices, failures to exchange because of someone ELSE pulling one of these tricks.
So I guess there IS a continuum of buyers and sellers but it isn't a CHAIN because no one is necessarily 'linked' to anyone else- what happens in THEIR house sale or purchase can't affect YOURS as you all have contracted dates on which things will happen.
I love that these ideas come up during a falling market, when prices are on the rise nobody ever suggests these things then.
Now, to be fair, I have always been stunned by the amount of shite the UK housing market puts up with.
BUT I think the current parlous state of the UK market- and by that I do NOT mean the 'house price crisis' because it isn't a crisis, it's the inevitable part of a boom/bust cycle- is born of the short termist British way of doing things: spend now and sod the consequences. It is inevitable that the Brits will put up with it without complaint because, perhaps for every time they've been gazumped, they've gazundered. Doesn't stop the whingeing about it when they're on the downside though!
It's the same reason why there hasn't been a public outcry about the bankers excesses- the Brits all know, deep in their hearts, that they aided and abetted this rampant risk taking and wild house price inflation thus carry some responsibility.
Anyway, I wouldn't for a moment say my ideas have been shaped by boom or bust- makes no difference really, does it? However, my experience of buying and selling has only been in the Queensland market which is patently better than the UK one!
It does make a difference because the sellers who were gazumped last time are now on the receiving end of gazundering, so at any stage of the cycle you'd have people being shafted at both ends so to speak.
We sold our house in April for a low price because we had a low offer accepted on a house we really liked.
On the day of exchange we couldn't get hold of the vendor, exchanged on our sale and then found out that the vendor had changed his mind! Didn't want more money or anything, just decided not to move.
So we are now living in rented after taking a massive hit on our house plus losing all survey/search fees/mortgage fees etc.
I will volunteer to make the placards!
In a nutshell, in My method, that'd be completely 'illegal' and would have cost the offending party dearly!
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