Who and what is the focus of the home moving process?

As noted in the 2018 Spring issue of First Comment, the Westminster Government is committed to improving the home moving process in England and Wales. So far, there is not a similar group in Scotland to the HBSG and, to the best of my knowledge, the Scottish Government has not yet engaged in what is a very worthwhile process. Hopefully, that will change soon.

Why is change required?

One could pose the question differently, namely: if we were to design a home buying and selling process today, what would it look like? It is suggested that even the most dedicated supporters of the existing home buying and selling systems in the UK would have difficulty in arguing that some form of change is not required. In my opinion, while the present system has served us well over many years, it is now showing signs of stress, and needs an overhaul, so that it is fit for purpose in today’s consumer-focused society.

Put simply, consumers deserve better. If we start with that assumption and keep consumers‘ interests to the fore, then this must inevitably lead to a series of reforms which, together, will amount to a fairly radical overhaul of the present systems. At the core of that change is the central driver towards transparency. Much more can be done to make the current systems more transparent and, quite frankly, less frightening, for the average consumer.

How will that be achieved?

Change is rarely, if ever, a single step process. More often it is the result of a series of small steps which, when viewed together, result in a major step forward. In no particular order, it is hoped that the work of the HBSG will lead to changes being introduced in the following areas:

1. Better information in the form of buying and selling guides for prospective buyers and sellers. This will enable consumers to be better briefed than is the case at present. While there are some excellent initiatives in this area by estate agents, lenders and solicitors, more can be done to improve the overall level of knowledge across the board.

2. Education – better education of those involved in the process should be a sine qua non. I very much doubt if anyone who works in the process gets up on any given day with a mind not to perform well in their job. We must, therefore, ensure that there are sufficient educational initiatives developed, which result in a well-educated workforce. This, in turn, will lead to a better-informed public, which should then lead to smoother transactions on a level playing field, as it were.

3. Better provision of data on properties for prospective purchasers. This can be in the form of a Property Passport or a validated Property Information Pack. There are also a number of interesting initiatives currently being advanced which allow lenders to better assess whether or not to lend on the security of a particular property. These, in turn, will influence the form and content of surveys / valuations of properties which, by necessity, will then impact on the investigative work expected of conveyancers under the UK Finance Lenders Handbook. Despite the negative press around Home Information Packs when they were proposed, who can really argue against prospective buyers having access to better information on properties? The mistake last time was to overload this information in a barely understandable format at the front end of the process. It is suggested that this time, the focus should be on providing better information in an understandable format: not information overload. Put simply, the property should be lender and purchaser ready. That was the way it used to be when a property was only exposed for sale when all relevant material and pre-sale title checks had been carried out.

4. Reservation Agreements – while there are arguments for and against such agreements, few can argue against their effectiveness being properly tested. If their use leads to the process being speeded up and becoming more certain, then surely that must be a good thing.

5. Central Property Portal – in today’s digital society, who is to say that we could not develop a central property portal, where relevant information on properties is stored by reference to their Title Sheet numbers and / or Unique Property Reference Numbers (UPRNs). A lot of work has been done in recent times to rationalise UPRNs, and the recommendations of the Geospatial Commission should be of interest in this regard. It will enable better information to be collated and made available to surveyors and conveyancers alike.

6. Trading Standards – central to any creation of new regulations will be enforcement. This will be the role of Trading Standards. This year we will see new regulations for estate agents and more of the same will follow. There has to be a level playing field.

7. Insurance – most life events are insurable, and property is no different. While not advocating that we move anywhere close to the American system, I can envisage a time when Title Indemnity Insurance will play a more positive role in the home moving process. At present, title insurance is generally associated with underwriting a risk when something has gone (or could go) wrong. What if the same insurance was used in a more positive manner to provide a standard as to what constitutes a good and marketable title for example? There are already some interesting developments in this area, and more will follow.

Conclusion

There are many, and varied, interests in the present house buying and selling system. To introduce a different way of working involves change and change, in turn, leads to fear and the perception of risk. As a result, these fears and perceptions require to be addressed as part of the change process. To do otherwise would be wasteful. The HBSG has covered a lot of ground so far, and it is to be commended for so doing. As stated at the outset, this industry will benefit from change and innovation, and it is better that this be led by the industry itself. We would do well to remember that we are all buyers and sellers at some point.