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Homebuying: a process far from easy

house buying

Last summer my husband and I decided we‘d like to move house. After having a relatively smooth experience as first-time buyers we hadn’t anticipated what was in store for us this time around…

We started to look for a new home. Feeling a little anxious about marketing our house too soon, as being in a sought after area we were sure it would be snapped up quickly.

But we were encouraged to put our home up for sale as we were told any offers we made would not be taken seriously unless our house was sold.

Well our house was sold within two weeks of it being on the market, so the race was on for us to find a new home.

A race to buy

Over the next three months we made offers on four properties before having any success.

On the first property, we offered full asking price for a property but the seller became completely uncontactable. On second property, the vendor decided to rent out the property, completely unbeknown to the estate agent.

Then on our third attempt, we offered full asking price and stressed that we’d be willing to negotiate. We were later told that the property had been sold, with no opportunity to increase our offer.

During the time it took to find a property, prices were increasing weekly and with an offer already accepted on our house, we were left with less and less to spend.

Luck of the draw

Finally, around four months into the process, the estate agent we’d sold our house through called us to tell us they’d just had a house come onto the market that they thought was perfect for us. Jumping at the opportunity, we went to view it that evening.

We made an offer there and then and the offer was accepted the following morning.

Nobody else was given the opportunity to view the property, which was lucky for us, but again shows how unfair the property market is.

Our purchase was completed three months after having our offer accepted. But we had yet more trouble and stress with the conveyancing.

The house we were buying was a probate property, so we expected a little hold-up. We were prepared to wait but didn’t expect the process to be nearly as long and stressful as it was.

Initially we were told by all parties solicitors that all conveyancing would be completed in advance of the probate being completed, so once probate was done the purchase would be very quick. This was far from the reality of it. Probate was actually completed eight weeks into the 12 week process.

A story far from unusual

But we’re now seven months on and are happily renovating our new home, breathing a sigh of relief that all of that stress is over. But when we chat with friends and family about our experience, however extreme it felt, sadly it’s far from unusual.

So have you recently experienced home buying or selling? How did you find the process? Did you find anything particularly complicated or stressful?

This is a guest post by Polly Freeman. All opinions are Polly’s own and not necessarily those shared by Which?

Comments
Member

Isn’t it time there was more protection for both buyers and sellers?

I have often thought both buyers and sellers should deposit say £10,000 with a solicitor or estate agent which they lose to the other party if they pull out of the sale for any reason other than an unfavourable survey.

Both parties would get their £10,000 back on completion or the injured party would get compensated.

In Polly’s case, if offers had been accepted, she could have been £30,000 better off.

Member

Whether you are selling or buying there can be a long wait between acceptance of offer and exchange of contracts during which either party can abandon the transaction with no adverse consequences to themselves. This causes undue stress because the seller is wondering whether they should have kept the property on the market and the buyer is anxious that the seller might have second thoughts or cannot proceed because of a problem in the upward chain. Local authorities are generally turning local searches around in a week or so yet they are commonly and wrongly blamed for delays. Mortgage approval can take much longer than it should, even when prospective buyers have a ‘mortgage in principle’ certificate. A valuer has to inspect the property and report back but that is not necessarily the cause of much delay – the internal administrative procedures of the lender seem to be a particular problem. I believe the main difficulty to be inherent in the chain of transactions whereby no one can progress to the next step until the one ahead has done so. Although it is highly debatable, on balance I tend to think selling first gives you the best chance of being in a commanding position.

I think Alfa has made a good suggestion that would concentrate minds wonderfully. I think the sellers’ agents were at fault in Polly’s three failed purchase attempts, albeit not legally so. Agents really must have a clear and committed understanding of their client’s position for which they should, to some extent, be accountable. The idea that – without repercussions – the seller can just go out of contact, or that the owner can just stop a sale and rent out the property, or that the seller can just do a deal on the side without involving the estate agent, is unsustainable. Such actions need to be regarded as a breach of contract between the seller and their agent and should require the agent to obtain suitable assurances from, and lay down obligations on, their client when accepting instructions so that the agent becomes party to the default. Taking a bond would certainly sharpen up the process.

Unfortunately, when we buy property we cannot choose the agent and I have heard many stories of deficiencies on the part of the selling agent. Agents do have a duty of care to the buyer but it is not as strong as their obligations to their instructing client and the duty is barely enforceable. When you instruct an agent to sell, a senior representative deals with you professionally and generally looks after you quite well; as soon as an offer is accepted supervision of the the transaction passes to a progress-chaser in the office and junior staff tend to handle all the calls from the buyer and concentrate on soothing them rather than telling the whole truth. The progress-chasers like to make themselves useful by frequently bothering the conveyancers over progress details so that they can appear efficient to both the seller and the buyer, but it is a façade and adds little or no value to the process in my opinion. Estate agents seem to have created this function for themselves in recent years and now they all do it. However, managing the chain is vital and left to conveyancers it might be even worse so something that galvanises the various parts of the process as Alfa proposes might do the trick.

The ideal chain has a first-time buyer at the bottom and a new-home buyer at the top and no intermediate transactions, but that is exceptionally rare, and even then things can go wrong if the first-time buyer hits a mortgage snag or the new-home buyer’s builder has not finished their property as scheduled, but at least there is usually time in such a short chain for people to wait without affecting anybody else. As soon as intermediate transactions are stirred into the mix the potential for something to cause a hold-up increases. Creating more new homes to buy, and enabling more first-time buyers to move, are absolutely fundamental to lubricating the housing market and no other remedy will work as well as that.

Bonds that bind sellers and buyers are all very well and good but there has to be room for the unexpected and there have to equitable exit routes for people caught in an impossible situation. We were selling a property when the buyer died suddenly [thank goodness it happened before the exchange of contracts or we would have had to proceed at the executor’s pace on behalf of the estate]. Structural damage can occur, all sorts of misfortunes can befall, and it is impossible to legislate for all eventualities. But there has to be something to stop the capricious from mucking up an otherwise perfectly good transaction.

For Polly to get the purchase all wrapped up within three months of acceptance of their offer is good going these days, but four months were wasted due to unnecessary, and preventable, flaws in the system.

Member

When talking this over with an estate agent friend the other day he confirmed that the biggest problem by far is the fragility of the chain. One problem in one link simply affects all the rest. They see no easy answer to this. You need to live somewhere, so can’t move until another house becomes available so if your move is frustrated you need to take other measures. Moving into a rented property if you can’t move on with your chosen purchase both costs money in rent for a contracted period and risks a substantial rise in purchase price in the interim.

Member

Absolutely right. People who move temporarily into rented property tend to also put a lot of their household goods and furniture into storage at additional expense and I suspect that most are in rented accommodation for much longer than they anticipated. The proceeds of their house sale will not appreciate at the same rate as the value of their next property will rise.

I see signs that a lot more new apartments are coming onto the market in Norwich as empty commercial office blocks are being converted into residential accommodation. That will help one sector of the market but there still seems to be a dearth of desirable new-build properties for people to buy and I think local councils have a lot to answer for here with their petty objections to developers’ designs and insistence on onerous obligations. I was talking to a local councillor and he was chuffed to bits that the planning committee on which he served had turned down a scheme because it featured ‘blind windows’ on end elevations [i.e. looking like former windows had been bricked up] which he said were not part of the vernacular building style. Well, in the first place there are plenty of local examples on very old houses where some windows were filled in to avoid the window tax, and in the second place why on earth is the council worrying about such a minor architectural detail in an otherwise attractive scheme?

Member
Lisa says:
4 June 2016

We were due to complete on 14th November, same day, someone was murdered in house directly opposite ……. we halted proceedings, eventually went ahead with purchase

Member

The whole business of buying and selling houses has become a racket where a whole swarm of professions are milking the hapless participants for what they can get. The government are raking in VAT so they turn a blind eye. As someone commented, if the buyer needs a mortgage then it gets a whole lot worse.

I should have thought citizens should require authorities that will look after them. Instead, buyers and sellers end up hating each other, egged on by the solicitors to engage in a sort of battle. Unfortunately I can’t offer an alternative.

A lot of the problems arise from the time the process takes. One step in the right direction would be arrange things so that the longer the professions take the less money they get. If the sum total of the fees starts where is does (about £25k) and then dwindles by 10% of the original amount (£2,500) each day until the houses are exchanged, I am sure that they would, for example, start using emails and stop practises such as second class letters or sitting waiting for hours connected to call centres whilst their clients rake up hourly fees.

Member
Robin Butler says:
6 May 2017

HM Land Registry was set up decades ago to simplify property transactions As a young conveyancing clerk at the time, after completing the traditional paperwork, I had to register properties with this new Registry. More than 60 years down the line, transactions seem to be no simpler, just as time-taking as ever, and several times more expensive! I think we can lay this at the door of the solicitors, whose vested interest in property transfers is guaranteed to spin out the process as much as possible, find every nit-picking reason to multiply the amount of work involved. To misquote Parkinson: “Work expands to accommodate the amount of money required for its completion.” In the old Soviet Union, people could complete the paperwork to buy and sell homes by filling in a simple form at the post office! I don’t think we need to become a Marxist state in order to find a way of streamlining this process.

Member
Peter McGurk says:
9 May 2017

Tell me, what VAT revenue is charged on house purchase?