The property industry has broadly welcomed the government’s decision to consult on major reforms to the home buying and selling process in England and Wales.
The proposed changes aim to modernise a system widely seen by professionals as outdated. However, some legal experts have expressed concern that rushing the reforms – particularly the requirement for sellers and agents to provide upfront property information – could lead to unintended consequences if not implemented carefully.
Liz Ramsden, a residential property lawyer at Knights, warns the proposals risk repeating the issues that came from the scrapped Home Information Pack (HIP) system from 2007, and urges the government to think carefully to avoid making these mistakes again.
Ramsden said: “The proposals announced by the government are well-intentioned and come at a time when the housing market desperately needs reform, but against the backdrop of a housing crisis, there’s a real risk they’re being rushed.
“These new plans sound strikingly similar to the old Home Information Pack system, which ultimately proved too costly and complex for sellers. Back then, many sellers paid hundreds of pounds to compile legal searches and documents upfront, only for the information to go out of date before a sale was agreed, forcing them to pay again.
“The new proposals risk repeating those mistakes. And the idea of binding contracts is particularly concerning. What would happen if someone were to lose their job or find issues following the surveys and checks on the property? The system needs reform, but it has to protect consumers as much as it promotes efficiency.
“To avoid another failed rollout, the government must learn from the last attempt and ensure information packs are digital, low-cost, and reusable, with clear validity periods to stop data expiring. It also needs to make legal advice mandatory before any contract becomes binding. Without those safeguards, the reforms could once again burden sellers and confuse buyers rather than speeding up the process.”
In response to the government’s proposed reform to the homebuying system, Lucy McCallum, head of residential conveyancing, and property specialist, at law firm WSP Solicitors, believes that giving buyers the option to enter into binding contracts early on in the process before all legal checks have been completed, “is unlikely to work in practice”.
She explained: “The government’s proposal to mandate upfront property information is a positive step towards tackling the inefficiencies and delays in the current home buying system in England and Wales. By including key details like title issues, leasehold information and any other potential issues, buyers can make more informed decisions and raise issues with their proposed lender early on to ensure they are able to proceed. It also flags issues early on giving both parties the benefit of greater transparency and certainty. If implemented properly, these reforms could help reduce transaction times and save both parties significant costs.
“Giving buyers the option to enter into binding contracts early on in the process before all legal checks have been completed, is unlikely to work in practice. Particularly where a buyer has a lender. If a lender’s requirements cannot be met once all due diligence has been completed, the buyers would be bound to complete, and unable to fund the purchase and they would risk losing their deposit. We would need to see more details on what is being proposed.”
Andrew Groocock, COO of estate agency at Knight Frank has welcomed the opportunity to speed up the transactional side of the home buying process, but he believes putting all of the onus on estate agents is not the answer.
He commented: “While the proposals’ ambition is commendable, there needs to be a complete overhaul of the Land Registry so that the data on it is accurate to at least a month rather than three-four months delayed. The ability to provide searches needs to be significantly improved, there are boroughs in London where local authority searches consistently take over forty working days – this needs to be digitised and instantly available, but that change sits with the government to invest in the correct solution to speed things up.
“There is a danger that the proposals simply pass all of the accountability and costs onto the vendor and estate agent. Under the current system the time delay sits between the offer acceptance and exchange period, the government’s proposals will simply shift this delay to the period before any property can be launched to market.
“We would encourage the government to consult with all those working at the sharp end of the industry in order to make meaningful, effective change which will benefit home buyers and sellers for the long term.”
Read the orginal article: https://propertyindustryeye.com/housebuying-shake-up-plans-are-concerning-legal-experts-warn/
