Set out below is an email I recently received from one of my Bold Legal Group member firms:
“We have been trying to get sellers to instruct us (and encourage agents to ask them to do so) when a property is marketed for years. If instructed, we visit the property and prepare a free report into what should happen to get things ready for when a buyer is found.
“Despite the fact that this costs us and can only be an advantage for the agent and the seller, take-up has always been very low. Why, I do not know. Perhaps it’s just extra effort for the agent?
“We do all of this free of charge. It is partly a marketing exercise, but a properly prepared report (what a HIP should have been), is of genuine assistance in getting a proper pack of documents ready for when a buyer comes along. I have always found that the quicker a sale goes, the more likely it is to exchange. This seems to me to be such an obvious thing to do, that it is a bit of a mystery why agents are so reluctant to take it up. I wonder whether they just don’t like to be seen to be selling conveyancing services to clients when they take properties on? Perhaps they are just so focused on winning the instruction and getting the valuation right, that they don’t think beyond that?”
I appreciate that (at the moment) not many conveyancing firms would carry out the above work initially free of charge, but there are some that do, and I believe that number is growing and will grow even more as the new Material Information rules are introduced.
There is very little doubt in my mind that agents and conveyancers will have to work more closely together when phase C of the new Material Instruction rules are introduced in the not-so-distant future, so why not do that now?
Rob Hailstone is founder of the Bold Legal Group.
Comments (26)
Half the problem with ‘UK law’ is shelf life and liability issues. It is the legal system that needs addressing, HIP’s was a disaster for so many reasons, everyone chirps on about some of the good bits and were very few that the consumer acknowledged.
Get it right chaps, you can’t eat your cake without baking the ingredients that go off after they have been out the fridge for a length of time.
Pre-preparation is not the answer with the conveyancing bit, everyone has been talking about it for decades and still no further forward. It is the availability of ‘instant access’ of information when it it is required, just like background checks on todays motor vehicles. Property is lanquishing so far behind.
If you are referring to search life Woodentop, shelf life and liability issues were resolved ages ago.
Nope I’m referring to much, much more. E.G. Surveys, insurers & lenders loan stipulations, sellers information packs, pre-contract enquiries all of which are relevant at the time of the sale agreed and exchange date. Not forgetting the old favourite of conveyancer’s, duty of diligence and care to their client and where many will insist on not accepting anothers word or must do the work again.
Can’t see anything there that hasn’t been, or can’t be solved, with some willingness by those involved, and more importantly, some degree of acceptance the naysayers sitting on the sidelines.
We wait to see but there is a reason why we are where we are for many decades, the wheel is round and no one to-date has made it work any more efficiently with so many interested parties having irons in the fire.
It is interesting that customer service does not come into the list above.
There are many people with large interests in the property transaction, but customer experience is generally poor as a whole experience.
If we are going to change things then some people/businesses will need to adapt their position, but with digitization there is the chance to review how the whole process operates for the consumer as well as those working in the industry.
I have over 60 firms in the BLG membership who will prepare a ‘sale-ready’ pack (and that number is growing daily). In addition to the obvious benefit for the client/consumer, they realise that preparing a pack (like an auction pack) whilst the property is being marketed, means they can do it without being interrupted by all and sundry, and they can hit the ground running when a buyer has been found. Creating a less stressful and more certain life for all involved.
If we keep doing the same things, we will keep getting the same results.
And what is the average fee of those 60 firms who charge for the service? If not “nothing”, then this does not deal with my second point made above. If your answer to that is the agent must therefore cover the fee, then how do we recoup the cost within our no sale no fee service? Do we build into our already begrudged commission an extra 200% (?) of the ‘sale-ready’ fee charged by lawyers, to cover the cost of those instructions that do not proceed to exchange of contracts? That would penalise the sellers who aren’t wasting everyone’s time coming to market.
Do any of those 60 firms offer a sale-ready service on a no-sale no-fee basis, or ‘no-sale instruction, no-fee’?
The upfront cost of Home Information Packs (HIPs), and the time they took to be put together were two reasons they were scrapped.
Don’t agree, HIPs ended up very cheap (little more than the cost of the searches), unless marked up by the agents, and most were produced within 24 hours. They were scrapped because they did not contain the right information etc, and did not speed the process up etc. The HIPs I produced (made as exchange ready as is possible, with early conveyancer involvement) did help speed up the process.
I will shortly have available directory of law firms that will take early instruction, some will charge high, some low, some might not even charge at all. Tinder for agents and conveyancers I guess:)
Surely the fee will be met by the seller prior to the lawyers starting on the pack. Why shouldn’t the lawyers charge for work they have done? The fact that estate agency offers no sale no fee is irrelevant. Having to pay upfront will, I admit, stop some sellers from putting their properties on the market, but those who do pay are committed sellers rather than simply testing the market as they know they can withdraw at any time without penalty. If the lawyers do some work upfront, then strictly speaking there should be less to do once a sale is agreed. It’s unlikely to happen anyway as lawyers and agents agree on very little and in any event, agency staff are not qualified to comment on a legal pack (insurance may be invalidated) and in the main (and this is directed at the corporates), staff have little or no knowledge of the conveyancing process. Just IMHO having worked both sides since the mid 80’s.
I see two problems:
1) The reality is that the vast majority of lawyers are already far too busy to get homeowners ‘sale-ready’ (today I’ve had to chase a solicitor who has not looked at replies to enquiries sent last Tuesday). If lawyers can’t keep on top of their current workload, how can agents trust them to take on more clients who are not even on the market or are unsold?
2) There is no way firms (or rather solicitors?) up and down the country are going to spend their chargeable time onboarding prospective clients for free; and there is little chance homeowners are going to pay for a conveyancing service before they’ve even had a viewing or offer.
Gain an instruction is the hardest part of the job
No agent wants to complicate the issue and tell a vendor they have to spend money up front to sell someone else’s service
“we visit the property and prepare a free report”
But they do not
deal with a corporate staffed by children or some bucket shop and the chain grinds to an halt
I would suggest that there’s also the problem of potential buyers reading something in the information online before they’ve seen the property that immediately makes them say “No!” and never even phone the agent.
However, if they see the property first, the “no way” issue might vanish if they decide they truly love it.
Does the extra info and reduced viewings save agents from dealing with waste of time appointments?
Maybe, but after 30 years in the industry, I know that lots of people end up moving on a simple whim, purely because they looked online, saw something they fell in love with and just went for it. I accept that it’s a small percentage of the market, but I would hazard a guess that it makes up enough of the market to make the difference for many agents in a normal year between healthy profitability and break-even.
Also from experience, having too much information available out there reduces the number of calls you receive.
“Surely, that’s great?” I hear you say, “More time for other things…”
But then you have a huge number of potential buyers out there that you have no proper buyer/ agent relationship with that you can’t call when the perfect property comes on the market. I’m old enough to remember having a box of contact cards, lovingly tended on a daily basis.
However, that’s really a problem that’s been created by the ubiquity of portals like Rightmove, et al, who have actively anonymised the process to make them more important than us.
Rob, if you could answer that one I think things could change quickly.
Interesting that chains raise their head in the comments but the amount of sales with chains continues to reduce.
I can only add my own experience here. Selling my own home, i prepared all the Property Information Forms and even purchased the searches. These were shown available to potential buyers in a PIP Vault before any offer was made. When an offer was made it was accepted on the basis of the information already made available and an exchange of contracts was achieved in 2 weeks and a day.
Bought a property in Scotland last year. SO much better to buy it with full survey done beforehand to a set standardised format. I know this isn’t the work of solicitors but my word it makes life clearer and removes the potential for finding out surprises post-offer acceptance. Vendor pays for valuation / survey obviously.
To Estate Agents it’s obvious. I’ve tried it, and provided chain information, certificates etc..and it’s made absolutely no difference. Why should I bother? I want the sale to complete quickly because I want to be paid, but if the Solicitor possibly isn’t bothering and placing the file to one side because there’s less to do and it can wait – then it’s an uphill battle.
Exactly
If the whole chain did it then the benefits would increase dramatically.
But they do not
deal with a corporate staffed by children or some bucket shop and the chain grinds to an halt
It’s SUCH a difficult balance isn’t it.
Clearly the status quo is not ideal, but changing it is very very difficult.
A supplier came to see us on Friday with a revolutionary solution and it did sound great. Problem was that it was so limited in scope and chains were very problematic, so in our opinion it just wouldn’t get enough traction.
Any solution that relies on the entire market “seeing the bigger picture” are doomed to fail unfortunately – it just doesn’t work.
I agree to a point Peter, sadly, we would still be smoking indoors and not wearing seatbelts without mandation I guess.
However, experiences ,like this should be compeling enough?
“A properly prepared report, is of genuine assistance in getting a proper pack of documents ready for when a buyer comes along. I have always found that the quicker a sale goes, the more likely it is to exchange.”
And this is not a one off comment supporting the benefits of up front info.
It’s a fair question Rob, which reminds me of the days of Home Information Packs when the Conservative government pledged to scrap them if they got elected.
One of the most telling comments I read was “if Home Information Packs are so effective at improving the home buying and selling process, then let the market will decide. If people see a benefit then they will pay for them”.
And they didn’t.
Change very rarely happens organically – just because something is a good idea doesn’t mean it’s adopted. It either needs to be mandated or very compelling.
As far as I recall, there has been no compelling evidence to support the concept that information up front reduces timescales and fall-throughs. Anecdotally, absolutely, but this is the exception not the rule.
Which is why people don’t voluntarily embrace information up front.
There are agents already well beyond phase 3 and have been for coming up 2 years, those innovative and forward thinking agents have shown what’s possible.
Once agents realise the implications of material information there is an inevitability about a change that will happen. In the same way a lot of agents now have financial services within the agency offering so it’s likely be with conveyancing.
There is bound to be the raised blood pressure of change and resistance to change but the pathfinders have shown the benefits of having conveyancing as part of the services they offer.