Selling Your Property - Seller's Packs

The introduction of these packs, also known as Home Information Packs, will change the way that sellers sell their homes. Designed to speed up the whole process, the government would like for them to be introduced at the beginning of 2007, although voluntary trials will begin in 2006.

The seller will be responsible for putting together a pack containing the terms of the sale, replies to local searches, surveys, warranties on brand new properties and any guarantees for work which has been carried out. For leaseholders, the packs also include a copy of the lease, service charge accounts and receipts, regulations made by the landlord, building insurance policy details and details of the landlord. The packs will then be available for prospective buyers to see on request. The cost of putting the packs together is not yet known, but is thought to cost around £500 to £600.

When the system was trialled in Bristol at the beginning of 2000, the packs were heralded as a success. 87% of agreed sales resulted in a transaction - 15% more than without the packs. Almost twice as many people were satisfied with the process than those using the original method and the time between offer and completion was cut down to about 48 days. However a total of only 61 transactions were carried out using the packs and they were free to volunteers.

Estate agents are being asked to help prepare the packs, local authorities are being asked to look at the turnaround time for the local searches and speed these up and lenders are being asked to improve their speed and efficiency in both mortgage offers and access to title deeds when they are requested. The government are also working on a system of e-conveyancing, which should make the whole legal system of buying property easier and speedier.

The proposed system has many critics, but is backed up by others. The main objection is the cost to sellers, however the government insists that these balance out as the seller buys a new property and does not have to bear those costs. Some of the arguments for and against the new system are outlined below:

For Seller’s Packs

• The packs should stop people who put their home on the market just to gauge reaction from pulling out of a sale. Paying several hundred pounds for the pack will mean sellers will only put their property on the market if they are absolutely serious about moving.
• Buyers will not be left seriously out of pocket if the sale falls through as they will not have had to pay for an expensive survey.
• Having all of the information there for all to see makes the whole process of buying more transparent as the survey and the search results will give them all the information that they need.
• There will be no need for lengthy negotiations under the new system, as all the information will be available when a sale price is set.
• The use of Sellers Packs will dramatically reduce costs for first time buyers, while as the whole process becomes more time-efficient, other costs should also fall.

Against Seller’s Packs

• The main objection is the increased cost and work to the seller. This is a particular worry in areas where the cost of housing is very low, so the cost of a sellers pack would be out of proportion.
• Some question whether a buyer should trust a survey that the seller has carried out, and feel that buyers will still want to commission a survey themselves.
• The critics also condemn the lack of formal laws against gazumping.
• If estate agents do not undertake to put together the packs, then having to do it yourself could cause a lot more stress to the seller. It would be their responsibility to obtain a survey, the title deeds, searches, planning permission reports, draft contracts plus any other relevant information all within a set timescale.
• Lenders may still want a basic valuation, despite the survey report.
• Many buyers do not commission a Homebuyers Survey when they are buying property, so having to have a survey done increases costs which might not have been charged originally.
• The information within a pack is likely to only be valid for three months, so if a property is on the market for longer, sellers could face more costs from having to update the pack.
• Smaller independent estate agents could also lose out if the bigger companies begin to offer free packs as an incentive to buyers in the same way as lenders offer free valuations or conveyancing. Smaller agencies would not be able to bear the cost of such an incentive, so would be forced out of business.

More Selling Your Property topics below:

• Estate Agents - what can you expect from an estate agent?
• Private Sales - avoiding expensive estate agents fees
• Viewings - what you should say, what you should answer and what you should ask.
• Offers - how can you tell when an offer is the highest you will get?
• Surveys - as a seller, what can you expect from the survey?
• Legal - what is involved with conveyancing for sellers?
• Financial - what can you expect to be paying for when you sell your property?
• Selling Pack's - how the government proposes to speed up the property buying process
• Moving - what you should organise in order to have as easy a move as possible.

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