Reforms to the house buying process in England and Wales to bring it more into line with Scotland could slash the typical transaction time by almost 30 per cent according to new research.
A quick sale company, Property Solvers, has analysed what it claims to be the largest capture of house sales data of its kind, measuring the moment a property is listed on Rightmove until the point at which it is marked ‘sold’ at HM Land Registry.
Residential sales across Scotland took an average of 12.57 weeks to sell compared to 16.11 weeks in England and Wales – representing a difference of over 28 per cent.
In Paisley, in the 12 months to the start of this month, it took an average of eight weeks for 251 properties to sell.
Sellers in Glasgow and Edinburgh were waiting an average of between 13 and 14 weeks respectively from marketing their properties to completion.
The slowest Scottish locations were Motherwell and Kirkcaldy where 732 sellers waited an average of 15 weeks.
In England, the research pointed to a relatively small number of sales in Central London taking between 10 and 11 weeks.
However, the majority were taking at least five weeks longer.
In Southend-on-Sea, Torquay, North London, Watford and Southall in west London, 2,054 sellers were waiting for an average of 18 weeks.
The author of the research, Ruban Selvanayagam, says: “It’s evident that the English and Welsh conveyancing process could learn some key lessons from Scotland.
“It’s the solicitors that typically take responsibility for marketing Scottish homes up for sale as opposed to estate agents in England and Wales. Prior to getting homes on the market, by and large, Scottish sellers are required to deliver a Home Report. In addition to an energy performance certificate, a property questionnaire must also be forwarded.”
He continues: “The seller will also supply a ‘single survey’ which the buyer can present to the lender for mortgage approval. Provided the surveying firm is on the lenders approved panel, there are usually no obstacles. This minimises an increasingly frequent issue in England and Wales of down-valuations that result in sellers pulling out or attempting to renegotiate the final purchase price.”
Selvanayagram says that although the Home Information Packs had limited success in England and Wales over a decade ago “there is a strong argument that sellers should be presenting their homes in a more transparent way.”
He states: “In a competitive market, to avoid the silly games that can often occur in the bidding process, buyers interested in properties above the asking price are invited to make sealed bids within a set timeframe.
“Once a legitimate bid is won, similar to England and Wales, the mortgage offer is confirmed and the conveyancing process starts. However, in Scotland, although a number of conditions are often applied, the exchange of documentation earlier in the process facilitates a much smoother transaction. In England, there is no legal commitment to the sale until contracts have been signed and exchanged.”
The research plays into current government thinking about reforming house buying.
In January the Ministry of Housing, Communities and Local Government revealed that politicians and officials were studying a ‘model’ two page reservation agreement drawn up by a law firm as a possible way of slashing fall throughs and speeding up transactions.
An announcement is expected soon on a pilot project.
The government has also hinted that it is looking at the idea of property ‘log books’ – although it insists it has no intention of reintroducing Home Information Packs which had been widely criticised by agents and others in the property industry a decade ago.
The government has already clamped down, via new guidelines from the National Trading Standards Estate Agency Team, on what it considers to be unfair and unreasonable referral fees during the property purchasing process.