If You Could Reform House Buying / Selling...

[Smokeahontas]

What would you change?

I like part of the Scottish system where the survey is done up front by the seller. I’d also find a way to make the buying process a bit more solid (subject to survey). No gazumping / pulling out for no reason / generally mucking people about.

Agree about the survey being done up front and possibly a small deposit being paid when offer accepted... just enough to discourage time wasters

Make it all the Scottish system. I moved house this weekend, the buy and sell took 6 weeks from start to finish, and the while thing was totally stress free

@JudgeRindersMinder I’m not a fan of the sealed bids bit

@Smokeahontas that’s the downside, but we bought at fixed price and sold at fixed price

In the Netherlands, the owner does the survey. After an offer is made, there is a 10 day cooling off period for both parties. After that it’s legally binding.

A much better system IMO.

[quote Smokeahontas]@JudgeRindersMinder I’m not a fan of the sealed bids bit[/quote]
The sealed bid bit is not compulsory.

Sellers don’t have to set a closing date.

Buyers don’t have to offer on properties with a closing date,

Seller providing searches that will transfer to new owner. Seller providing home condition report. Much of the delay is buyer solicitor trying to get information. Legally binding after 2 weeks.

Change it so it's like the EU country where I live. Once sale is accepted - buyers pay a 10% deposit and agreement to purchase after 10 working days. Exchange then takes place within 4 months. There is a (very) limited list of criteria allowing people to pull out. So, no gazumping or deciding not to sell or increase the price at the last minute.

Oh, and if a buyer offers the asking price, the seller cannot refuse their offer (well, unless there are justifiable reasons). This means they can't hold out for a higher offer, or play buyers against each other.

All in all, it's a much less stressful procedure, and house prices are more stable.

Oooh - yes, our system is like the one in the Netherlands highlighted above....

Didn't Tony Blair try to introduce Seller's Reports? Didn't go down well. If a house has been sitting on the market for a long time I don't want out-of-date surveys or searches. I want the current situation, commissioned by me, not by the person who is trying to sell and therefore minimise the reporting of problems.

Oh, and if a buyer offers the asking price, the seller cannot refuse their offer (well, unless there are justifiable reasons). This means they can't hold out for a higher offer, or play buyers against each other

It’s the same in Scotland when a property is advertised at a fixed price. The seller has to accept the first unconditional offer.

I agree with putting down a deposit shortly after your offer is accepted, which would be non-refundable if the buyer changes their mind for no good reason.

If the vendor has to provide the searches, I would expect a time limit and for them to be redone if the house was up for sale for a while.

I definitely think something more legally binding after sale agreed, before exchange, needs to happen.

I have just sold a home in USA and bought one in Canada. Once an offer is accepted, both parties have to sign a contract agreeing to it, and that contract is mostly binding. In both places, buyers have to put an amount of money down after their offer is accepted (it was lower in the US than in Canada, in our case) which is not returned to the buyer if they pull out for any reasons not listed in the conditions. Conditions will be things like subject to inspection (survey), subject to financing, subject to appraisal. If the inspection turns up major remedial work, for example, the buyers can ask for it to be done before completion, or they can ask for a credit from the seller.

In the very hot Canadian market we just bought in, some sellers will get their own inspection done and offer it to sellers - this is a courtesy due to the fact that there is often not enough time between going on the market and the offer deadline to have the inspection done. The problem with this is that as a buyer, you never know how much you can trust it, as the inspector was working for the sellers and not for you (home inspectors here aren't surveyors as such). The house we ended up buying had 4.5 days between going on the market/allowing viewings, and the offer deadline.

Having read so many threads on here about sellers suddenly asking for more (or buyers asking for less) the day before or the day of completion, I don't think I would ever have the nerves of steel required to buy real estate in the UK.

I read that in the US you have to state a moving date on offer and this is agreed on the sellers acceptance. Seems so sensible

I really think that solicitors need to be held more account able for timings and also communicating the process with the full chain. Ours has been a nightmare and any time I try and get clarity it feels like I'm being a pain, but it's literally their job!

I'm not sure the sellers having a survey done when they put it up for sale as a positive. I really wouldn't trust it to be independent and not be completed by the sellers family friend etc to benefit the seller. I think that's why the earlier idea of a sellers report wasn't put through as most people would still want their own done.

I think the searches should be completed and returned within a shorter time frame and all parties commiting to a moving date at the beginning of the process would be much more helpful.

I'm selling for the first time (and buying) & what strikes me is just how long, drawn out & complicated the whole process is! Why does it take so LONG!

I was told to expect 12 weeks. So 3 months, seems crazy. But I'm biased, I want this done & dusted already..#impatient

Offers are legally binding (with contingencies) and when accepted binding for seller too. Timeline for getting survey and financial sorted.
Councils streamline search system- somethings do not change much (environmental) and some all the time (planning). But they can have info available online that cover several post codes and then more specific things like title searches can be done for each property.
I'd be wary of a seller provided survey, so that should still be on buyer but with a time limit.
What's useful for buyers and what agents should insist on is that the paperwork is in order before marketing a property: all building regs certs, planning permissions, FENSA certs, guarantees etc should be already put together.
Now this will not be popular: require agents to get a license, are regulated and earn a better commission. Then have all properties available for all agents to view, and they split the commission with the listing agents.

Solicitors seem to take a long period of time to do quite standard stuff. There could surely be some revision there.

You make your offer subject to the surveys being good (or done upfront)
The offer is a binding contract through the solicitor, you can't just drop out, either buyer or seller without a penalty.
It weeds out those who are not serious buyers or sellers.

@Smokeahontas

What would you change?

I like part of the Scottish system where the survey is done up front by the seller. I’d also find a way to make the buying process a bit more solid (subject to survey). No gazumping / pulling out for no reason / generally mucking people about.

Yep exactly this.

SO much faster as a buyer and more transparent all round

Id like to go back to th e 80s and not allow the selling off of council housing, and instead give tenants wanting to buy a grant to vacate. So maybe 5k or so, depending on size of house and area, which they can use towards a deposit or legal fees.

@senua

Didn't Tony Blair try to introduce Seller's Reports? Didn't go down well. If a house has been sitting on the market for a long time I don't want out-of-date surveys or searches. I want the current situation, commissioned by me, not by the person who is trying to sell and therefore minimise the reporting of problems.

Yet it works so well in so many other markets. The UK is the exception, very much not the norm.

But yes, I'd like to see something similar to the Netherlands system.

Sorry, I mean English system, no offence to you north of the border

The Australian system works well, not dissimilar to what’s described above.

You put an offer in, if it’s accepted you pay a small deposit (£1,000 - £5,000) which has a cooling off period of 5 days. Once this happens, neither party can back out of the sale without a very specific reason noted in the contract of sale.

Your contract will be subject to the usual conditions (satisfactory survey, finance, potentially an onward sale) and you will have an agreed period (usually 21 days) to achieve this. Once this is done, you pay the rest of the deposit & the sale goes “unconditional” (contracts exchanged). Settlement (completion) usually takes place 2 weeks later.

People rarely sell in long chains in Australia, if they do then completion is staggered to allow people to move at leisure. Short term bridging finance is very common because of the certainty in the buying/selling process.

The other dreadful aspect of selling in the UK is the searches process. In most countries these are digitised and self service. Waiting 28 days+ for searches to be returned (or 8 months if you’re unlucky enough to be buying in Hackney currently!) is utterly insane.