Propertymark calls for a dedicated housing court – and financial penalties for pulling out of a transaction

Propertymark’s recent written submission to the Law Commission not only calls for a dedicated Housing Court but also delves deeply into the possibilities for reform of the home buying and selling process.

Highlighting that digitisation of property information records could provide a smoother and quicker pathway to upfront information being made available to buyers at the earliest possible stage of a transaction, Propertymark is supportive of a Government proposal that tenure, ground rent, service charge (including details of future increases) and lease length should all be publicised in marketing materials and across portals.

The use of property logbooks tied to a property’s UPRN (Unique Property Reference Number) is commended but Propertymark calls for property logbook companies to be regulated and for government to ensure data is kept secure and GDPR compliant.

Noting that whilst CPRs are already compelling agents to give material information to buyers, the trade body says that following the demise of HIPs government assumed that the industry would respond to market pressures to elevate service levels. However, it says that in a largely regulated industry where agents’ fees are the main factor affecting consumer choice there is little incentive to elevate service quality: legislation and regulation are necessary.

Propertymark says that the provision of information upfront via property logbooks, digitisation of local search mechanisms, and a shift towards vendor disclosure will undoubtedly make prospective buyers better informed, speed up the conveyancing process and reduce the number of failed transactions making it quicker, cheaper and less stressful for all.

On the basis that the proposed reforms will address the balance of information asymmetry in the home buying and selling arena, Propertymark is supportive of the trialling of reservation agreements to foster commitment and reduce the number of failed transactions. The UK Government has indicated that this trial is due to commence later this year, but any such trial is surely dependent upon there being sufficient information available for a prospective buyer to make a binding purchasing decision. It is Propertymark’s view that consumers want to see joint commitment to progress once an offer has been accepted.

Consequently, once a solicitor has been instructed Propertymark says it is right that there should be a financial penalty for any party who withdraws from the transaction, but reforms to access and provision of information are therefore fundamental to the success of any such scheme.

In their response, Propertymark argues that the current court system is in immediate need for reform; stating that although landlord possession action has been steadily decreasing since 2014, the time taken from claim to repossession is increasing, with the median time standing at 21.1 weeks by March 2020.

It therefore proposes the formation of a new court, dedicated solely to housing matters.

Propertymark argues it is because of the inefficiency of process and “a fundamental lack of faith in the present court system,” that Landlords are five times more likely to use a Section 21 notice than a Section 8, even in the presence of rent arrears or anti-social behaviour, as they believe it to be the faster route to possession, which is crucial in minimising overall costs. In the context of the possible abolition of Section 21, Propertymark points out the increased pressure on the court system would be catastrophic.

Timothy Douglas, Propertymark Policy and Campaigns Manager said,

“The current backlog of cases shows we desperately need to see a change in the way PRS issues are handled. Our members are seeing a lack of private rented supply and failure to reform the court system is likely to result in a lack of confidence for private landlords, ultimately leading to a further loss of investment in an already highly penalised section of the housing system. A dedicated housing court would provide faster, less costly resolutions for tenants and landlords.”

Propertymark also contends that the current system is also too complex and costly for tenants, meaning their rights are not upheld. The response released at the end of July states a housing court should be accessible and provide consistent judgements so that all parties can have faith in the system.

 

The full submission by Propertymark makes for interesting reading. It can be found here.

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17 Comments

  1. Rob Hailstone

    A simple starting place would be to get sellers to instruct conveyancers when a property is first marketed. Thereby, using the usually ‘legally dead’ time to get the ball rolling. No matter how much, or how little, ‘up-front’ work is done to begin with, any amount will help. A thousand-mile journey starts with the first step.

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    1. PeeBee

      Hi Rob

      You say “A simple starting place would be to get sellers to instruct conveyancers when a property is first marketed.”  What sounds simple and what is simple are two opposing poles on a very powerful magnet, and trying to force those attracted to one pole to go to the other could have a devastating effect on the market.

      You only have to think back to the HIPs debacle to see the effect of adding additional time and money to the process, especially in the case of the (insert percentage that suits the agenda) of homeowners who come to market on a semi-speculative basis.  Enforced costs and hoops to go through could well take those numbers out of the equation completely – and whilst it is fact that some of them would likely stay where they are, having added to an Agent’s costs for no return and made the ‘Numbers Game’ statistic look that slight bit more believeable, a good chunk (in my experience and that of others I have previously discussed this with) do actually go ahead and move.

      As I said above, anyone can pick any statistic to make this ‘argument’ work for their particular agenda – but whatever the numbers are, they would adversely affect the market.  And not just for Agents – but for conveyancers too.

      Find a way to do it with minimal/no cost – and then you’re talking.  Otherwise your first “simple” step on that journey could be one off a cliff.

      I’m not telling you anything you don’t already know here – and that you will have already thought through. In order to get the readership to bite at what you say you need to put a lot more meat on the currently flesh-free bones – and I for one look forward to reading it.

      Regards

      PB

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    2. Woodentop

      There shouldn’t be a need for vendors to incur unnecessary costs if the information is available at the click of a mouse at the point of time needed. That is the solution with delays in conveyancing and just about available today if they linked together all the appropriate parties with Tech. It would work even to the extent that the buyer could find all that information before submitting an offer. But that would relegate conveyancers to advisers!

       

      Todays ‘Consumer Protection’ is anti incurring costs if not necessary and chances of getting work done that is not yet required (HIP’s fiasco) will not be popular with the consumer.

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      1. PeeBee

        “There shouldn’t be a need for vendors to incur unnecessary costs if the information is available at the click of a mouse at the point of time needed.”

        But of course “shouldn’t” and “won’t” are two distinctly different things, Woodentop. There are some conveyancers that might open a file without a charge – but there are just as many if not more that start the charge-clock ticking at the point of creating said file.  And why noy – they start to incur charges themselves; the people doing the work to get the file up and running require payment at the end of the month, and all their other bills keep on coming.

        Every “click of a mouse” as you put it is a cost point.  Only right that there should be a charge for it – or that cost is shifted to the next paying client’s bill.

        A bit like NSNF.  In some respects, the NSPR agents have got it right.  Actually, not some respects – maybe just one.

        And only a small part of that respect at best.

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  2. JamesH79

    Propertymark really need to pick a side, they either represent the industry or the consumer.

    All their consultation responses seem to encourage more red tape and interference by government in our sector, almost the exact opposite of every other “trade body”.

    Although good to see in section 17 they at last admit we are regulated.

    ” However, in a largely regulated industry where agents’ fees are the main factor affecting consumer choice there is little incentive to elevate service quality: legislation and regulation are necessary.”

    Having said that, to argue their members don’t have an incentive to elevate service quality is perhaps a little out of touch… to put it gently.

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  3. Bryan Mansell

    The private sector has solutions to this issue and has for some time, perhaps Propertymark, under new leadership, should concentrate its attention on a recommended 3rd party supplier list. Proptech has moved much faster than the Gov and PM to solve some of the upfront information challenges and secure sales for long-suffering agents and their customers. Excellent solutions are available, many for free and already in use. Providing the results of these services to PM and the Gov may get things moving faster and also show consumer appetite for change.

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  4. jan - byers

    pm are a total waste of space the agency equivalent of 57 old farts

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  5. Landlordinsider

    PM totally out of touch on this. There is no political appetite for a housing court. Far better to improve existing processes than call for something that is never going to happen.

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    1. jan - byers

      they probably had the idea during a long “business” lunch 
      ***** organisation

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  6. Richard Copus

    Jan Byers really does need to get up to speed on Propertymark.  For the last half a dozen years at least the Board has consisted of young farts and not old farts with the age of NAEA presidents being in their thirties and forties not sixties.  More to the point, how did they get there?  With the proven system of rising through the branches now defunct, some board members have appeared as if from nowhere with no local accountability on the way, and it is arguable that some are actively involved in competing organisations.  Propertymark is not just a waste of time.  It provides excellent education and legislative training for members at a fraction of going elsewhere, provides a professional framework in its Code of Practice for agents to work by and does have input at government level  –  whatever its detractors would like to have us believe.  Sounds like knocking it for the sake of it.

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    1. PeeBee

      “For the last half a dozen years at least the Board has consisted of young farts and not old farts”
      Surely ’tis not the age of a fart that matters – but whether it is effective in letting people know it is there.
      Farts come in all types – ‘silent but deadlies’… ‘botty burps’… ‘cheek-rattlers’… ‘thunder-pumps’… ‘under-duvet nose-burners’ to name but a few, and, lest we all forget, the dreaded ‘follow-through’.  All of those have varying degrees of satisfaction to they who deal them – but none are necessarily welcomed by others.
      And if you drop a fart in an empty room no-one is going to know – so why not save it for a more public outing?  The answer of course is that a fart is better out than in – or so the saying goes.
      Isn’t that what the NAEA does – enter an empty room, let one squeak out… and scoot out again?  Then let people know by email or press release that they’ve ‘dropped a botty-bomb’ and are expecting the resultant to rain down and change everything like it was some kind of global extinction event.
      Show me a way to make a fart welcome and interesting (by anyone other than they that brewed it… and perhaps a handful of rather strange sorts) – and actually useful for a purpose other than venting of waste, and you have the answer to the what is now sadly seen (as clearly demonstrated by the comments here on EYE and elsewhere) as the purpose of the NAEA.

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      1. Ding Dong

        brilliant  …if anyone could describe in football terms that would be welcome

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        1. PeeBee

          Don’t footballers – and their Agents, as well as Managers, Chairpeople, etc – fart also, Ding Dong?
           
          Same principle. ;o)

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    2. JamesH79

      FYI, Propertymark’s code of practice is the TPOS code of practice… so it’s a framework anyone can follow.

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    3. jan - byers

      As you say some are in  their 60’s so they qualify as old farts others  may be young  in age but old farts in mentality  who pontificate and slap each other on the back and tell each other what\  great job they are doing.

      The fact is the general public have never heard of them and most agents do not give a poo about them,.  They are a total irrelevance.

      As for their provenance I have never heard of any of them,  before and they have sent years doing an unskiilled job for which there are no barriers to entry and no qualification required other than to own a suit.  As yo say some of their branches are now defunct which shows their ability such as it ever was.  Now they have stopped being agents and pontificate about it and the good old days.

      As for the so called excellent training – it is multiple choice that a retarded money would get right.

      Some of the questions I saw are where are the rafters located in a house

      Question 20 If you are required to work with display screen equipment (DSE), you must be provided with? A A chair arm rest B An eye test every year C Protective glasses and subdued lighting D Equipment meeting certain minimum standards

       

      Your agency has conducted a number of viewings at a property and most applicants have commented about the lack of parking facilities. What should you do? A Explain it has not been an issue for the current tenant / landlord B Suggest other roads or carparks where they could park C Feed the comments back to the landlord so they are aware of the situation D Do nothing because they are all time-wasters anyway

      You really think this is “EXCELLENT” training!!!!!!!!!!!!!!! LOL

      The web site says the difficult exam requires less than 2.5 hours study a week.  My kids in junior school do more homework than that

       

       

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  7. ferrisbueller

    Regulation of sales and property management would be a good start. Too many sharks and cowboys giving the rest of us a bad name. Weed out the Chaf so the rest of us can prosper!

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  8. Richard Copus

    Just to mention that I was talking about the training rather than the exams Jan and the trainers are generally first rate.

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