Why It’s Taking Longer Than Ever For Derby Property Sales To Complete
Despite what the press and various reports would have you believe, the Derby property market is very active with property sales of all shapes and sizes being agreed and plenty of demand from buyers of all types in and around the Derby suburbs.
The biggest issue that buyers, sellers, estate agents, Solicitors, mortgage brokers and everyone else involved in the Derby property “eco-system” is having to deal with is the length of time we are all having to wait for a transaction to exchange and complete after a sale has been agreed and the Solicitors have been instructed…
If you’re involved in buying or selling a property right now, I’m sure it’s a problem you can relate to and one that has no doubt been adding another level of stress to what could already be described as a pretty stressful process.
If we go back three or four years, the average transaction time across the UK was roughly 12 weeks.
From the Draft Contracts being created to picking up the keys, you could have pretty much relied on being in your new home within around 3 months.
Fast-forward to today and that average, across the nation, has climbed to 16-17 weeks, and sometimes far in excess of that.
That’s an extra four or five weeks that buyers and sellers are having to wait before they can finally celebrate and walk through the door of their new property for the very first time.
So, the first question is Why?
Given the supposed advances in technology and more organised practices managing the process, why is the timescale increasing instead of going the other way?
Well there are a host of factors but two in particular that we’ll explore in a little bit more detail in this article and also let you know what we at Hannells, and several other local businesses, are doing to combat the situation.
Firstly, as time goes on, we’re finding that Solicitors dealing with property transactions are having to become increasingly diligent in investigating properties and potential problems as regulations become tighter and any mistakes made can quickly result in being sued.
Covenants, indemnities and problems that Solicitors may have brushed over a few years ago have now become issues which must be rectified and dealt with before a transaction can exchange and complete.
That in itself is adding time on to the process.
The best way to combat this is to let your agent know as soon as possible if there are any issues, or potential issues, that could affect a sale later on down the line.
The sooner your agent knows about them, the sooner they can prepare and help to make the necessary arrangements to address the issues so that things aren’t held up when you do find a buyer later down the line.
The second biggest contributor to the length of time, and especially in Derby, is the time it is taking for the Council to prepare their Local Authority Searches.
Whenever you purchase a property with a mortgage, the lender will require that amongst other searches, a “Local Authority Search” is ordered.
This part of the process is usually undertaken by your Solicitor.
The Local Authority Search contains useful information about the property and the surrounding area which your Solicitor will investigate to make sure there are no issues with roads, planning applications and contaminated land etc.
The main issue with this is that at the time of writing this article on the 8th May 2019, the current turnaround time stated by the Derby City Council for a Direct Local Authority Search is 52 working days.
Over 10 weeks….
It’s almost as long as the whole time it used to take to exchange and complete on a property.
Now we’re only just getting back the Local Authority Search.
This process has almost trebled over the last few years and it’s a huge contributor to the reason why sales, and particularly in Derby, are taking so long.
I’m reliably informed by a number of Search Providers that this is one of the worst turnaround times for Councils in the country.
We have raised the issue with the Council and they are aware of the impact this is having on local buyers and sellers.
By all accounts, the search department at the Council is severely under-resourced and at present time, we see little chance of this changing any time soon.
To address this very serious situation, we recently hosted a number of local estate agency owners, Solicitors and search providers to put our heads together and see if we can come up with a solution.
It proved to be a very interesting meeting and is perhaps one of the few times that so many businesses competing in the same arena have come together in such a way.
The consensus amongst everybody involved is that if “Direct” Local Authority Searches are unlikely to see any signs of improvement, we should adopt the next best practice which is ordering a “Regulated” Local Authority Search.
I’ll attempt to explain the difference between the two below without getting too technical.
When your Solicitor orders a “Direct” Local Authority Search, a “search provider” will make the order on their behalf and the staff in the Derby City Council Searches department will extract the information required, package it together and send it back for the Solicitor.
When your Solicitor orders a “Regulated” Local Authority Search, the “search provider” books an appointment with the Council Searches Department for one of their own agents to visit the Council to extract the same information, package it together and send it back for your Solicitor.
The same information is gathered from the same sources, in the same manner and presented to the Solicitor in the same way.
It’s just that in one case, the Council provides the information and in the other, the search provider does – who at present have far more capacity to get it done quicker.
In the past, Solicitors and lenders may have been hesitant to accept what was called a “personal” search as they were unregulated and sometimes unsatisfactory.
However, this has now massively changed with “Regulated” searches being a fully regulated industry (hence the name) and all providers having to adhere to a set of codes administered by CoPSO – The Council of Property Search Organisations.
There are now very few lenders who will not accept a “Regulated” search. It perhaps affects one out of every hundred sales.
You can even check when you have agreed your mortgage to make sure your lender is on the list so you know whether they whether they will or not. An updated list of lenders that accept this search can be found by clicking the link below:
So, if you’re looking to purchase a property, make sure that your Solicitor orders a “Regulated” Local Authority Search to literally shave weeks of the time it takes for you to pick up your keys.
So long as your mortgage lender is on the above list, there should be no reason why your Solicitor will not do so, apart from having to change “the way they’ve always done things” and this was a viewpoint supported by all the local estate agencies, search providers and many local Solicitor firms when we recently met.
All of the Solicitors that Hannells works with are ordering Regulated Local Authority Searches and if your own is not prepared to do so – we would suggest you seriously consider switching to a Solicitor that does.
Whilst this is by no means a complete fix, it will most definitely have a big impact on transaction times.
This doesn’t just affect our hugely valued customers who we are working hard to fix this for.
This effects every single property sale throughout Derby that requires a Local Authority Search from the Derby City Council.
It also greatly affects our teams who are having to deal with issues they have not previously faced and bear the brunt of the anger from understandably upset and frustrated buyers and sellers who are dumbfounded by how long things are currently taking to progress.
If you are one of those frustrated buyers or sellers involved in any property chain, not just with Hannells, hopefully this information provides a little bit more of an explanation as to why things are taking so long – although it in no way justifies it.
Derby City Council have been receptive to our concerns and are sympathetic to the effects the current turnaround time has on everybody involved in the process.
We will continue to work with them to explore every avenue to cut down the current timescales.
I am hopeful that with the support of almost every other local estate agency and Solicitor practice, we will be able to bring about a positive change to a process that if left alone will almost definitely continue to spiral out of control.
So, to all the buyers and sellers out there, I wish you the best of luck with your sale and purchase.
Whilst the “after sale” process does require a little more patience than it used to, the Derby market is undoubtedly buoyant and it is a great time to move – so don’t let that put you off!
And, of course it goes without saying that if the team at Hannells can be of any help, please feel free to get in touch at any time with any one of our seven local branches.
All contact details can be found on the link below;
All the best.
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