PropTech Today – Why has overhaul of buying and selling still not happened?

The government and property industry have been talking about it for a long time, and there have been numerous initiatives introduced to try and speed up the homebuying and selling process and reduce the number of fall-throughs in the market, but real, tangible, long-term reform has remained sorely lacking.

But why is this the case, given the importance of housing as a basic need and the property market’s position as one of the economy’s key multipliers (never shown better than during the pandemic, when it was one of the first major industries to reopen)?

A still archaic system

Too many parts of the property market remain stuck in the past, even as many agents become increasingly forward-thinking and innovative. There is still far too much paperwork involved and too many potential barriers in the way to successful sales.

This happens from the very start, with the controversial practices of gazumping and gazundering frowned upon but perfectly legal and commonly used. There has been much talk of banning these things, but so far no concrete action.

There has also been talk of introducing reservation agreements, to tie buyers and sellers into a deal much earlier and make it far less easy for people to withdraw without a very good reason. But, once again, no concrete action.

We also know the process is often slowed down by a lack of information being provided upfront, by both buyers and sellers, to prove they are serious about their purchase or sale. These early hold-ups are then compounded by delays in the conveyancing process, which is still too reliant on physical documentation and old-fashioned ways of doing things.

Steps taken to change things

Despite the above, there has been no shortage of effort and ambition to change the sector for the better. The Home Buying & Selling Group (HBSG) was established in 2017, shortly after the government’s Call for Evidence on how to make the process of buying and selling a home cheaper, faster and less stressful.

The goal of the group – which is made up of representatives from across the industry, and chaired by property expert Kate Faulkner – is to help the industry and government work closely together to achieve these aims. It has said it is motivated by a genuine desire ‘to effect change’.

To facilitate this change, smaller expert teams have been created to focus on areas which HBSG has agreed will bring the greatest improvement to the consumer. This includes providing more information prior to offer to avoid mis-selling and reduce timescales; reservation agreements to reduce fall-throughs and provide greater certainty; improving the understanding of home movers and the education of property professionals; reforming leasehold and estate rent charges to create a better balance between the interests of the parties; and working together to identify issues with industry working practices and identifying workable solutions.

The pace of change in the property industry is often slow, though – as we’ve seen with certain legislation in the rental sector in recent years. Opposition and obstacles to change are commonplace. But, during the Covid crisis, the property industry has shown how adaptable to change it can be to keep all the pieces on the chessboard moving.

It has embraced tech in a bigger way than ever before, with virtual viewings, online market appraisals and other digital solutions to get round the issues of operating during a global pandemic.

The industry’s main goal should be to make buying and selling simple, safe and guaranteed, with empowered buyers, safe sellers and happy agents forming a happy triumvirate.

The process should be easy, digital, fully transparent, paper and stress-free, and as simple as 123 – something which is far more likely with committed, motivated buyers and sellers knowing where they stand from the off and hopefully enjoying a painless sales process.

Promising signs

There are other good indicators for the future, too, in particular the work that is happening at HM Land Registry, which has a huge role to play in helping to digitalise and modernise the property sector.

It has been one of the most innovative government departments of recent years, willing to trial and experiment with new technologies like blockchain to speed up the home buying and selling process. It has also looked at smart contracts, digital registers and digitally signed mortgages to make the homebuying and selling process more dynamic, flexible and tech-led.

In March of this year, Land Registry’s Digital Identity Standard was launched, providing rules on identity verification to enable virtual verification, for example requiring the use of smartphones to upload biometric chip data from passports and other government documents.

You can find out more about Land Registry’s digital transformation programme – from encouraging digital identity checking and electronic signatures in conveyancing, to online mortgage deeds – by clicking here.

This recent weekend feature on EAT by Hayley Hellon from ProConveyancing also set out how e-conveyancing could transform the industry if various roadblocks were removed, showing there is the will and tools there to change things for the better.

More to do

While the work of HBSG, Land Registry and various PropTech firms is driving things in the right direction, there is still more to do to lead to genuine, long-lasting reform.

What is certain is that a property market with more upfront information, fewer fall-throughs and a speedier, lower stress process is something we should be all aiming towards.

And agents, conveyancers and PropTech firms like Gazeal can help to make it happen.

*Bryan Mansell is co-founder of digital platform Gazeal