Contribution from HomesMatter (www.homesmatter.co.uk)
Problems
Consumers find the process of selling and buying a home to be stressful, time consuming and expensive and reform is long overdue. The major problem is there is no certainty a transaction will go ahead. A seller or buyer can pull out for any reason whatsoever without penalty prior to exchange of contracts resulting in unwanted cost and heartache for millions of sellers and buyers.
The technology, commercial nous and political will to make the process better exists but initiatives introduced by Government – for example Home Information Packs, Energy Performance Certificates and the Chain Matrix - have not fully delivered on this potential. Organisations such as the e-Homebuying Forum are attempting to resolve this. However, with many disparate types of organisations involved with differing interests, it is a complicated and time consuming process. Homes Matter's founder is trying to help move the process forward.
Solutions
Options being considered include:
Exchange-ready Home Information Packs containing everything a buyer's conveyancer needs to exchange contracts
Home Condition Reports carried out by a RICS approved surveyor to reduce the risk of a prospective buyer pulling out
Valuations acceptable to lenders prepared by a RICS surveyor. Most lenders accept these in Scotland.
In principle mortgage offers - should not be a problem for any lender
Sealed Bids as in Scotland to ensure certainty of transaction and reduction in house price inflation.
No obligation quotes for repair work highlighted in HCRs by accredited home service providers
Free Home Energy Audits and completion of recommended works to make the home more attractive to buyers
Online tracking so sellers and buyers can see how their sale and / or purchase is progressing
Where we are now
Home Information Packs
Home Information Packs (HIP) were introduced in 2007 with the objective of improving the homebuying process. However, estate agents, conveyancers and surveyors did not support their introduction and consumer opinion and the media is divided as to whether they have helped.
The push at the moment is for exchange ready HIPs to become the de facto standard. However, the Conservative Party have said that if they are elected this year, they will abolish mandatory HIPs. They have, however, said they would work with industry on voluntary exchange-ready packs provided they add something to the sales process rather than act as an additional cost for the seller. For further information on HIPs, please see the Government website.
Home Condition Reports
By providing a Home Condition Report (HCR) or survey on their property, owners could make it more saleable. However, sellers have purchased very few HCRs to date due to poor marketing. RICS and others are now working to create an improved version.
Around 85% of all property transactions involve chains of varying lengths and about 1/3 of these breakdown causing problems for everyone concerned. The major reason for breakdown is the buyer pulling out because of an unexpected problem with a survey and if a chain collapses because of this, then everyone loses out. If owners provide a survey, it will help reduce the risk of a buyer pulling out, chains breaking down, the need for sellers to have to accept an offer subject to survey and speed up the offer to exchange timeframe.
Under the "current" system, most of the information needed by a buyer is only produced after they arrange a survey. So, if there are any problems with homes these only come to light several weeks later by which time sellers have incurred legal and HIP fees etc. Problems include for example, a new roof being needed, faulty electrics, damp or subsidence. It could be a much smaller problem but once a buyer knows a problem exists, he/she thinks there might be more 'hidden' and will invariably either lower their offer once they have an estimate of the costs to repair the fault(s); ask the seller to fix it – or drop out altogether.
It is an established fact that many sales fall through when a prospective buyer has a survey carried out which reveals a fault(s) which requires remedy. If a seller arranges an survey upfront, all of the important information the buyer needs to make a decision is available, resulting in them being much less likely to pull out. In turn, this will lead to a quicker sale - and no disappointment for the seller.
The technology, commercial nous and political will to make the process better exists but initiatives introduced by Government – for example Home Information Packs, Energy Performance Certificates and the Chain Matrix - have not fully delivered on this potential. Organisations such as the e-Homebuying Forum are attempting to resolve this. However, with many disparate types of organisations involved with differing interests, it is a complicated and time consuming process. Homes Matter's founder is trying to help move the process forward.
Solutions
Options being considered include:
Exchange-ready Home Information Packs containing everything a buyer's conveyancer needs to exchange contracts
Home Condition Reports carried out by a RICS approved surveyor to reduce the risk of a prospective buyer pulling out
Valuations acceptable to lenders prepared by a RICS surveyor. Most lenders accept these in Scotland.
In principle mortgage offers - should not be a problem for any lender
Sealed Bids as in Scotland to ensure certainty of transaction and reduction in house price inflation.
No obligation quotes for repair work highlighted in HCRs by accredited home service providers
Free Home Energy Audits and completion of recommended works to make the home more attractive to buyers
Online tracking so sellers and buyers can see how their sale and / or purchase is progressing
Where we are now
Home Information Packs
Home Information Packs (HIP) were introduced in 2007 with the objective of improving the homebuying process. However, estate agents, conveyancers and surveyors did not support their introduction and consumer opinion and the media is divided as to whether they have helped.
The push at the moment is for exchange ready HIPs to become the de facto standard. However, the Conservative Party have said that if they are elected this year, they will abolish mandatory HIPs. They have, however, said they would work with industry on voluntary exchange-ready packs provided they add something to the sales process rather than act as an additional cost for the seller. For further information on HIPs, please see the Government website.
Home Condition Reports
By providing a Home Condition Report (HCR) or survey on their property, owners could make it more saleable. However, sellers have purchased very few HCRs to date due to poor marketing. RICS and others are now working to create an improved version.
Around 85% of all property transactions involve chains of varying lengths and about 1/3 of these breakdown causing problems for everyone concerned. The major reason for breakdown is the buyer pulling out because of an unexpected problem with a survey and if a chain collapses because of this, then everyone loses out. If owners provide a survey, it will help reduce the risk of a buyer pulling out, chains breaking down, the need for sellers to have to accept an offer subject to survey and speed up the offer to exchange timeframe.
Under the "current" system, most of the information needed by a buyer is only produced after they arrange a survey. So, if there are any problems with homes these only come to light several weeks later by which time sellers have incurred legal and HIP fees etc. Problems include for example, a new roof being needed, faulty electrics, damp or subsidence. It could be a much smaller problem but once a buyer knows a problem exists, he/she thinks there might be more 'hidden' and will invariably either lower their offer once they have an estimate of the costs to repair the fault(s); ask the seller to fix it – or drop out altogether.
It is an established fact that many sales fall through when a prospective buyer has a survey carried out which reveals a fault(s) which requires remedy. If a seller arranges an survey upfront, all of the important information the buyer needs to make a decision is available, resulting in them being much less likely to pull out. In turn, this will lead to a quicker sale - and no disappointment for the seller.
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