The Ministry of Housing, Communities and Local Government have been researching with the aid of working group called the Home Buying and Selling Group which is chaired by a research firm and includes solicitors and estate agents. They have been considering ideas for the last 11 months of how to improve the process of buying and selling property in the UK.
Key Stats from research so far
12-14 weeks offer to completion
Leasehold adds at least a week to this timescale
25-33% of all transactions fall through
Costing £270m per year
People move every 19 years
Most people will only move 1 or 2 more times after first move
Rapid changes in finding a new home to purchase but limited progress elsewhere such as the process itself.
One million homes bought and sold each year.
Challenges for the government are:
Market is not broken enough to need an immediate fix
Lack of consumer experience
Emotional purchase especially once found dream home
Dis aggregated market: 4100+ conveyancing firms and biggest has 2% market share
Need for chains
Lack of digitization – Land Registry/local authority searches
Solutions they are considering
Tackling uncertainty with the use of Reservation/binding agreements
70% of buyers and 66% of sellers worried that the sale would not make it to completion after they had accepted an offer.
50% of buyers and 70% of sellers would have been prepared to enter into a legal commitment after offer. – Reservation/binding agreements to be tested.
Recently announced a field trial of this type of agreement which will start later this year.
The ideas is that if every party has some ‘skin in the game’ (financial commitment) then less likelihood of the purchase/sale falling through.
Would love to hear your thoughts on this so please comment below.
Would this have helped you in a recent purchase or sale?
So that concludes this episode of Ask the Estate Agent Podcast. You can contact us anytime using the links below:
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