Preparing For The Sale Of Your Home
Legislation For 2007
From 2007 estate agents will not be able to market property unless they are able to provide to a genuine applicant a Home Information Pack (“HIP”).
The HIP will contain legal documentation including copies of a local search, possibly other searches, seller’s title and matters arising, a Fixtures and Fittings form, answers to standard enquiries, any guarantees and any relevant planning consents etc. For leaseholds a copy of the lease and documentation relating to management of the property will be required.
In addition the HIP will have to contain a Home Condition Report (something less than a full survey).
Today’s Best Practice
Amongst solicitors and estate agents dealing regularly with higher value residential properties it is already considered best practice to produce before marketing a pack of documents, which, with the exception of the survey, includes everything required by the future legislation and indeed normally goes much further. The reason is that sellers want to avoid any delay on the part of a prospective purchaser: by providing at the outset the answers to almost every question that the purchaser’s solicitor might raise the possible excuses for delay are removed.
Best Practice Should Be Universal
There is no reason in principle why this practice should not be adopted by all sellers. Why should a person selling a house for £100,000 be any less concerned about unnecessary delays than a person selling at, say, £1,000,000?
Sensibly, all sellers should address legal issues as early as possible; if you think that you are likely to sell in the near future approach your solicitor now so that he or she can ensure that when a purchaser is found, everything is ready for the purchaser’s solicitors.
What will your solicitor do in practice?
Your solicitor will typically:-
- obtain copies of your legal title and background documents and check that there are no issues that need to be addressed;
- prepare answers to all foreseeable enquiries which may arise from the documentation ;
- help you with the Fixtures and Fittings Form :
- do the necessary searches ;
- cooperate with your estate agent in checking that the description and plan of the property are accurate;
- identify issues that a purchaser may raise and resolve them ;
Causes of delay in a sale
The most common legal causes of delay currently include:
- Planning and other consents for recent, or even historic alterations to the property are not to hand or were not obtained; also replacement windows are now subject to regulation ;
- often the seller did all the right things when extending or altering the property but, despite obtaining Building Regulation Approval, omitted getting a Building Regulation Completion Certificate ;
- there are old covenants prohibiting building or alterations (or requiring someone’s consent) or some document which may contain covenants is missing. ;
- obtaining details about the management of a leasehold block normally involves seeking information from the managing agents;
- defective access rights to the property from the highway. Reasons include a village green or other strip of land lying between the highway and the property . Those are just examples of a surprisingly common problem. Similar issues arise over rights for drains and water pipes running under neighbouring land.
Probably not all of these matters apply to you! - but you would be prudent to check that none of them do. Most are soluble but it always takes time.
“But I don’t need it checked, because my solicitor was so good when I purchased….”
This is an entirely reasonable point of view, except for the fact that conditions have changed.
The purchaser’s solicitor normally has to certify the title to a mortgage lender. Mortgagees’ requirements have tightened over the past ten years; it is no longer sufficient for the solicitor to use common sense and prudent judgement; however efficient and sensible your solicitor was when you purchased, there may be issues that he rightly did not address then, but which you need to address in order to sell the property now.
What is the best advice?
If you are thinking of selling in the foreseeable future, do not wait until the day the property is marketed before asking your solicitor and your estate agent to work together to ensure that all potential problems are resolved and all documentation can be delivered to the purchaser’s solicitor as soon as you agree a sale.
