The last time Home Information Packs were suggested, there seemed to be less willingness to look at the legal conveyancing process and more resistance to change amongst estate agents.
Now, though, players in the proptech space are shining a light into the conveyancing process and actually looking at leveraging the datapoints it touches.
This remains the fundamental problem, and until the conveyancing process itself is speeded up, electronically or otherwise, cutting transaction times via a Home Information Pack is unlikely to be overly relevant.
One of the reasons identified for the failure was the last minute removal of a statutory Home Condition Report.
For me, one of the biggest problems with a vendor-instructed report is always going to be not necessarily its veracity but certainly its objectivity.
However, if a seller is willing to pay for an HCR upfront, it would seem to indicate that they are more serious about selling.
Perhaps in an era when prospective sellers are getting used to paying for services upfront, like some online agents, perhaps some kind of HCR will gain currency.
For agents, the absurdly slow speed of transactions is taken for granted mainly because they are the only people servicing the process who have a vested interest in actually concluding it, being paid purely on performance.
Suppliers of legal and survey services are paid whatever, and mortgage brokers, although paid on performance, tend to be hamstrung by the ever more panel based legal system applying to those seeking a first charge.
So I suppose it’s possible to surmise that talking about HIPs is really tinkering around the margins of a process that requires a complete overhaul.
The public should know that there’s no use moaning at agents. It is lawyers that the focus should be on, and unkind though it may sound, expecting them to overhaul the system brings to mind a phrase that includes the words turkeys and Christmas.
Technology in conveyancing is only of any benefit if conveyancers actually use it. If they are not prepared to talk to each other, reply to emails without being constantly badgered by us, then nothing will change. In a housing market where instructions are on the low side, adding another sizeable upfront cost is going to destroy what little supply there is. Of course our government have no clue as to how the housing market works, so no doubt they will bring back HIPS, and not give a toss about the consequences.
Proptech not the answer, common sense and communication is
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There’s a piece of kit called the ‘telephone’ that I would suggest conveyancers try and master the use of before getting involved with anything too advanced…like email.
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Not sure of the point of the above article – sorry.
Solutions to the speed up the legal process of house moving once a buyer has been found?
Inter alia….
1. HIPs – obviously. Upfront information – no survey though – but only to be produced by the actual conveyancer handling the conveyancing.
2. Regulate who is permitted to offer conveyancing. Too many law firms employing non-skilled people
3. Stop talking about more IT as any kind of assistance to conveyancers. No further IT is needed. I feel abolition of Land Certificates (electronic access) has led to fraud. Fraudsters are already preying on the electronic methods conveyancers already use.
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The whole point of the HCR was to provide a report on the condition of the property on the day it was inspected, which could be relied upon by seller, buyer and mortgage lender! The original HCR had a specific section at the rear for the lender, negating the need for a mortgage ‘inspection’ The only thing missing was a ‘valuation’ but that’s fairly easy to achieve online, for lending purposes or LTV, these days. Yes, it may have been vendor instructed but it was ‘freely’ available to the buyer. Bit like the landlord paying for the tenants referencing!!
Title, searches, F & F and all those other bits and bats are also relatively quickly provided but could be improved upon.. The ‘opinion’ on the aforementioned and the legal ping pong is where the delay often occurs…
I was always a great fan of the HIP in general and it must be remembered that it was based upon about 20 years worth of reviewing the property transaction process.. Do we really need to ignore the expertise of all those who contributed to this review process and reinvent the wheel?
If you’re serious about selling (and we all love time wasters, don’t we?) you will pay for it in any event – why not pay for it up front?
Of course someone will need to convince The Law Society and CML…
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These are all valid points but as a company that is leading the way in terms of communication and technology, (we were the first to produce an electronic contract pack with a digital signature) there is another issue here.
The concept that lawyers get paid whether or not the deal goes through and hence have no “skin Inthe game” is a rather outdated concept.
Given the significant amount of work that goes through the panel broker network (surely a euphemism for the world’s oldest profession) which is always on a no sale no fee basis, this metric really doesn’t apply any more.
Just a small point -we are regularly asked for this -its very common. The problem is that no-sale no-fee arrangements can only work if the success fee is high enough. Hence why agents have to charge appropriately given the nature of a market with a 33% fall through rate.
We currently have a less than 5% fall through rate, which, whilst is really fantastic, still means we can’t afford to do no-sale no-fee.
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we checked over the last 50 sales and were shocked to discover it was 74 days average from sale agreed to exchange.
I work in a small town with just two conveyancing firms locally as we don’t want to upset them, we refer them to our clients and buyers, we cajole them along, talk nice to them, plead with them.
I was very close to going to one the big city firms, I wanted to go to the big city firms.
But as any agent who works in a small community will tell you, we have to stick together because the local solicitors talk too!
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Said it before i will say it again.
Attitude needs changing of conveyancers – But as Ed mentions above it would mean turkeys voting for Christmas.
Its strange when ever the sales process comes up 99% of agents agree the service from conveyancers (in the main) is shocking. Its then conveyancers coming on here telling us its not.
If they cannot look themselves in the mirror and admit there is a problem it will never change.
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I can just imagine my local conveyancer shivering in the corner, hugging his fax machine surrounded by books of second class stamps, muttering ”i dont get it……..i dont get it”
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I’m an Estate Agent, but I must stand up for the poor beleaguered Conveyancers out there… have you any idea how much extra work has been foistered on Conveyancers in the last 10 years, principally by lenders ?
Lender requirements have gone through the roof, all with a view to foisting responsibility / liability onto the lawyers and their PII.. the latest being the ridiculous requirements around establishing proof of funds, and even verifying the identity of the donors of third party gifts.
Lawyers are now on the hook if every matter relating to building regulations is not fully investigated… hence FENSA certificates, issues with illegal loft conversions etc etc.
Then we have the whole leasehold nightmare… we Estate Agents would help ourselves enormously if we actually found out who the managing agent was, what charge they would make for providing their pack of info, and then actually collected the money… but no, let’s leave that to the Conveyancers.
Our experience was that HIPs did help speed up transactions, but politics and vested interests killed it. Had Estate Agents given their 100% support to HIPs, the outcome might have been different.
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But how many conveyancers took the HIP, chucked it in the bin and started again because the information within wasn’t complied by them, rendering it unrealiable?
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Did any do that? Why? HIPs meant we could almost instantly Report to our clients, as we had title, searches, seller questionnaires. What went wrong wiht HIPs was the fact that non-lawyers were producing them, and missed out things, so when they arrived, they were not complete.
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They also had a shelf life on particular sections which had to be paid again.
HIPs came about not beacuse it was to reinvent the home buying service and repace the conveyancing but as “a guide to a buyer” as to what they were getting into. They also came about because of EPC’s and EU laws which the government of the day (Labour) was under threat of £m fines and passed the costs off to HIPs paid for by the public.
Until local government searches and Land Registry comes fully on-line you will not speed the process up. That is where the real savings are to made and then conveyancers can work so much faster, if they have a secure PC.
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They were hardly ‘a guide’ Woodentop – they were the same documents, provided ‘up front’ and documents which could be relied upon (until their shelf life elapsed of course!)
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Here we go again, ” HIPS or no HIPS” that is the question”. No. After 40 years in the property industry the single key issue is “chains”. And neither government or the industry can get their heads around it.
Buying property is straight forward, if it is a sole purchase with no chain behind or in front. Trying to get “the ducks in a row” of a chain of two, three even four or five and with an industry fall thru’ rate of 30% mostly contributed to sales aborting within chains, is ridicules. Until this changes, there is no hope of speeding up the process.
Perhaps someone can correct me if I am wrong when I say that the UK is the only country with chains. Chains do not exist in the USA, Australia, NZ, France, Spain, Italy, Germany and so on. Need I say more. Oh yes,why is completion date set on a Friday? RH
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Interesting point on Chains. What do these other countries do then in the main or what is the best system you know of?
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“Why is completion set for a Friday?”. Mainly because that is the date that comes through on the MOS!!! It also gives house movers the weekend to settle, thereby usually taking just one day off work. On the question of speeding up transactions, conveyancers often have their hands tied, I would ask all estate agency workers to have a read of the CML Handbook and then read the Conveyancing Protocol. Have a look where the two fit like a glove and where the two disagree. Of course, you will tell me that when a buyer isn’t having a mortgage, you can ignore the CML, but you can’t. What happens when the buyer comes to sell and sells to a buyer having a mortgage. If problems aren’t corrected when the first buyer buys, then when that buyer becomes a seller the issue/problem has to be resolved then and usually at a greater cost. A conveyancer acting for a buyer is the only professional acting for the buyer (unless the buyer commissions their own survey). The estate agency staff represent the seller, the mortgage valuer represents the lender.
A couple to throw into the mix…
1. Why is it so many transactions will “fall through” unless exchange takes place by month end but the %age that actually fall through is almost 0?
2. Why do the vast majority of estate agency bods have no understanding of the conveyancing process? What do the owners/managers actually teach these people?
I will now put on my fire retardant overalls and hard hat and await the vitriol and thumbs down that wil head my way. I may spend the rest of the afternoon looking at an urgent file. I may not open it, just look at it!!!!!!!!!!!!!!!!!!! – There, feel better?
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Sorry am i missing something?
Do i have amnesia???? – I do not remember HIPs speedy up the process at all.
All it did was stop people coming to the market which is why they were scrapped.
What am i missing? – Genuine question!
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Agent V. You sign a legally binding contract on agreeing to buy and you have a limited period of time to finalise the purchase. During this time period you can withdraw for any adverse reason to purchase. Otherwise, failure to do so will forfeit the deposit, usually 10%. Your loan is agreed before going house hunting and is lent to the buyer and secured on the property. Its down to the buyer to establish the valuation and structural condition. And if you fall back with repayments, your property is seized quickly and sold normally by auction and the ex-owner owing the outstanding balance. So it is a similar process in some ways. With chains you are at the mercy of solicitors, valuers, sellers changing their mind, adverse surveys, searches.
And finally, on the conveyance side of things, a Notary is appointed to act for both parties. Simples! Seller/Notary/Buyer. So replace HIPs and Conveyancers with Notaries. RH
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