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TODAY'S OTHER NEWS

Tale of our times: flat sells after 575 days at £111,500 below asking price

The Money editor of The Mirror newspaper has finally sold a home he first put on the market in late 2016 - but after one year, six months and 29 days he has got £111,500 less than the initial valuation given by his agent.

James Andrew has written in today’s Mirror that in order to sell the flat - which had more than 20 viewings - he spent over £4,000 buying the freehold, in addition to spending several thousands on repainting and carpets.

But Andrew’s story isn’t one simply blaming the agent - his is a chronicle of “bad luck, a bad market, buyers changing their minds, hold ups, legal issues and more.”

“We looked at online estate agents, to save on fees, as well as traditional high-street ones – and eventually decided to pay more to get more from a high street agent” writes Andrew, who doesn’t say which firm he chose.

His property was a two-bedroom, two reception room apartment in Clapham, south London, and he says he chose the agent on the basis that he valued £30,000 above the second-highest.

“By the time the photos were in and the brochure ready it was the start of January. Our first viewing was arranged for just a couple of days after the flat came on the market and all looked well” he says.

In March 2017 - around three months after the property went on the market - he cut his asking price by £50,000. 

Andrew realistically describes how the additional stamp duty surcharge on additional homes, the phasing out of landlords’ mortgage interest tax relief and other measures - including uncertainty caused by Brexit - added to the torpor of the market and reduced the possible landlord market which might have been interested in his home.

In addition, the surprise early summer General Election last year added to the hiatus.

At the end of last summer, Andrew was more aggressive at price-cutting even than his agent. 

“We cut another £50,000 from the asking price - £30,000 more than the estate agent first suggested – and this time it worked. The new price went live in October, almost a year after we started the process, and the first person to view it after the reduction put in an offer” explains the editor.

Although that was £20,000 lower again, Andrew accepted but he soon found it was too early to celebrate.

The buyer backed out just before Christmas and “we were back to square one.”

By January 11 this year had accepted a new offer – this time £12,000 under asking price – but that carried a condition from the buyer that the deal be done by April.

Andrew then rejected the conveyancer offered by his estate agent (he objected to “referral fees of hundreds of pounds flowing from the lawyers to the estate agent”) and instead chose a cheaper firm with a ‘no sale, no fee’ guarantee.

“While we saved hundreds compared to some firms, and the lawyers did the work, it wasn't done fast. They simply didn't respond to emails, from the buyer's solicitor or us, for days or even weeks” he writes.

In the end Andrew commissioned and paid for a fire report, gas safety report, FENSA certificate and an electrical PAT test to satisfy the buyer’s legal side. 

Then, less than a week before his April cut-off date, Andrew went to his solicitor in person - only to find a range of forms had either been omitted by the firm or incrrect ones had been completed by Andrew himself. 

“We missed our April deadline” Andrew admits.

Finally, having luckily been granted an extension by the purchaser, all the paperwork was gathered together and - despite a last-second hitch requiring other flats’ freeholders to sign a document - everything was ready. 

He writes: “Finally, on Monday June 18 - 575 days after instructing the estate agent, having spent £672.80 on lawyer fees, £4,000 on redecorating, £1,944 on 18 months of storage, £4,708 on the freehold, £179 on safety certificates and not having had a holiday in a year - we were sold. The sale price finished £111,500 under the first valuation provided by the estate agent, they received £12,840 of our sale price in commission.”

Perhaps predictably, Andrew concludes his lengthy piece by saying “I’m never moving again”.

But he does not blame the agent, nor even the conveyancer - although, if you ignore the sluggishness of the housing market, it seems that conveyancing was the area where most of the pitfalls and panics happened.

Instead, it’s an interesting story of how complicated an apparently simple sale can become, and how slow it is - partly because of buyers and the market, but also because of ‘the system’.

What’s your view on this?

You can see the full, lengthy article here.

Poll: This shows the sales process need reform

PLACE YOUR VOTE BELOW

  • Rob Hailstone

    What sorry tale that pretty much has most things in it that could cause delays. £672.80 on lawyers’ fees (for a leasehold transaction in particular) does not seem a lot, maybe a more expensive lawyer would have been more professional and attentive. Doesn’t sound like the conveyancing price comparison searches James made were up to much? Nevertheless, and price should not be an excuse, very poor service from the conveyancer.

    James should have had all of his paperwork in order and instructed a conveyancer (one who dealt with a high percentage of leasehold transactions) whilst the property was being marketed and should have asked them to prepare a sellers pack (a bit like an auction pack).

    The Government are looking at a number of initiatives that could, if implemented, have helped James. For example:

    The introduction of reservation agreements
    The introduction of property logbooks (get sellers ‘sale/market ready’)
    The creation of new How to Buy and How to Sell guides
    Improving the way managing agents and freeholders respond to questions
    Introducing more transparency with referral fees
    Regulating and getting agents to qualify
    More e-conveyancing

  • Peter Ambrose

    In what other service industry would it be acceptable not to respond to communications for "weeks".
    These "local" conveyancing firms should be ashamed of themselves.
    All the bleating in the world about "pity the poor lawyer who is hamstrung by rapacious referral fees" does not justify gross incompetence such as this.
    Any manager of a law firm out there who thinks that such attrocious service levels are just part and parcel of conveyancing needs to get out of the industry. You are making consumers' lives a misery and bringing the industry into further disrepute.
    Have some pride and respect for the business you own.

  • Louise Jefferies

    Oh what a tale of woe indeed. This house buying and selling is frought with danger.
    In my humble view;
    The property was over valued in the first place.
    Agents still win listings by selling /telling vendors their house is with more than it is.
    Hope value is worth nadda!
    He should have been made aware there is another way.
    Que shameless plug; A transparent online or in room bidding auction where he would have paid 0 fees would have saved a year and a shed load of stress and uncertainty. The buyer pays the fee, which is a sure way to get them to “commit to complete” in 56 days.
    As for the conveyancing, people should always be brave and kick off about poor service.
    #thereisanotherway #sdlauctionpartners

  • icon

    Yikes. Here is the original article in the Mirror.

    1. If you want an automatic 'no completion no fee' guarantee, then that is typically the volume outfits where they do very little and so have little to write off.
    2. The Mirror article says "Instead, I used conveyancing price comparison searches, then found the best-reviewed, reasonably priced [conveyancer] I could." - Fatal. We won't go on such websites as they simply scream "our legal service is dreadful, but we are cheap...please please please use us"
    3. Cheap, fast and accurate. You will never get all three. Which will you sacrifice? Instead secure: affordable, prompt and accurate.
    4. "local law firm to drop off documents". Red-herring as conveyancers do not visit the property and conveyancer to conveyancer work is all email and letters….and they give clients prepaid envelopes getting you signed up weeks in advance anyway. Or we do at least.
    5. Sellers do NOT do gas/electricity inspections of their own property.....the English system is 'buyer beware'. Buyer's lawyers...tell your clients to do their own, and don't ask selling lawyers, as it just delays everyone getting the deal done. Buyers survey, buyers inspect. If a seller does them, the contract is not with the buyer, so it is doubly a waste of time, and false buyer security. Seller's lawyers....tell your clients as much....and estate agents, don't make a seller do them so as to not rock your commission boat. Support your client and tell a buyer to do their own.
    6. Buyers lawyers, don’t slow the deal down and ask for FENSA and GasSafe certificates when the relevant websites shows the property had accredited work (https://www.fensa.org.uk/fensa-certificate https://www.gassaferegister.co.uk/notifications/landing-page/ )
    7. Sellers. Remember, your Estate Agent is the project manager, it is their deal, they put it together. They are paid huge money and they need to keep the deal together at all times. Use them. Your lawyer is not your project manager, they make sure the legal papers are sound, hence they charge a fraction of the estate agent, as their role is quite different.
    8. Estate Agents - support the selling lawyer (you are the same team) but also make sure the selling lawyer does not drop the baton you handed to them when you put the deal together, as you need them to make sure you are paid…..too many conveyancers think estate agents are a pain, but they need to realise you chase/call as you depend on them to get paid for all your prior weeks of work.
    9. I am a solicitor whose first priority is my client at all times, so sorry, I therefore cannot say a good thing about an online only estate agent.
    10. The conveyancer. Go cheap, get cheap, Good luck. The price of a conveyancer is a complete red-herring. It guarantees nothing, whether cheap or expensive ….but £672 is far too low by any standard for a leasehold sale for a lawyer (inclusive of VAT etc) Yikes. As with estate agent, the lower you pay, the less incentive there is to go the extra mile when it is needed. Don't be naive to think otherwise. They are cheap for a reason.
    11. A conveyancer must NEVER blindly forward enquiries to their selling client without checking if their client should be answering them. Examples are the conservatory questionnaires or septic tank ones. We reject them nor use them. For every question a seller replies to in a conveyancing transaction, the buyer may have a future claim for a possible misrepresentation. If the seller gets sued, and they counter against you as their conveyancer because ’the Protocol says I never had to answer it and you didn’t protect me'….PII claim.

    Tomorrow, my firm could badge our office cleaner (no disrespect to cleaners) as a conveyancer and set them loose and there is no regulation stopping it. Madness. The problem for James Andrews in this article, is that not a single body, regulator or organisation is focused on tackling that issue - one of the biggest culprits for conveyancing misery…the quality of the actual conveyancer doing the legal work.

  • icon

    As someone who works in the industry and just gone through the process it is interesting to read some of the comments.

    What started out as a simple cash sale - buyer was qualified having the monies in the bank - it then became demand after demand for every single piece of paper issued and a refusal to agree to an exchange date (despite the buyers protestations she wanted a quick completeion - which we also needed) until the Buyers Solicitor had every single Fensa/Gas Safe/Building regs/EICR etc certificate despite them all being on the register and would not budge without them - I even had to pay £20 for a Fensa certificate for a window that no longer exsisted (superceded by an extension so is now a doorway) as they refused to accept that they didn't need it as the window no longer existed (that was a circle we went round a few times!).

    I would have gladly paid for an up-front pack with everything in and have, in return, confidence that the process could give me some protection when said cash sale suddenly (on the day my Solicitor) ended up with a related sale and the buyer suddenly needed 3 weeks to tie it up despite us having moved out of the property due to emigrating....we end up paying a mortgage along with the associated costs a month longer because we had no other option than to keep going with Sale and there is abolutely no come back on the buyer or her Solicitor.

    I can honestly say the house seling process is fundamentally broke and affords no protection whatsoever to the seller and is made a lot more stressful by jobsworths who use the job title 'Solicitor'. Transparency and honesty are two words that mean nothing to a LOT of people in the Housing industry. The whole process needs tearing down and rebuilding.....

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