It has been interesting reading the responses to the government’s announcement about a new digital innovation project at the weekend. Lots of people arguing about which bit of tinkering at the edges should take precedent over others and whether the industry should adopt electricity or not (I might have made that bit up).
I spent 30 years working in business transformation before launching Chimni. I ran a consultancy that worked across e-commerce, utilities, advertising and television. Some of those industries are now on their second or third digital revolution while the property industry is still stumbling around trying to get into its first. Every industry we worked in had its rear guard of old buffers resisting change.
In 2002, I did a presentation about internet video to the advertising industry and had a group of senior execs telling me we were talking rubbish. ‘No one is going to watch television on a computer!’ I remember one screaming at me. So when I see the conveyancer old guard forming committees it makes me laugh. What marks these people out, as with the advertising execs, is a crushing lack of imagination and, most of all fear. They know change is going to happen but were hoping to have retired before it got going. I recommend ignoring them and they will soon be on the golf course muttering to each other.
But that won’t help those of us left dealing with industry change. In 2017, I went to my first HMLR workshop on digital change and kept the notes and the whiteboard outcomes. Its been nearly eight years, almost nothing on the charts has been done. When we went to the launch of the DPMSG a couple of years ago and the ‘industry leaders’ stood up and said ‘we are going to think the unthinkable, we start with a blank sheet of paper’ many of the tech companies at the back of the room looked at each other in utter horror and amazement. Five years of prep work forgotten. So where do we go from here?
In all the responses I read to the recent announcement, there was the same flawed assumption that people involved in the previous initiatives should be allowed to drive future developments? As an outsider looking on, the last 10 years looks to have been a litany of bumbling failure. So I have to question whether we should be rewarding the same people with another go at it? Or should we accept that this is an industry that is fatally unable to reform itself and make some really significant changes. Here is an outsider’s view of the things that the Government should actually think about .
Law Society / CLC – the government should remove the regulatory responsibilities from these bodies and appoint a new Property Transactions Regulator in the model of the Financial Conduct Authority (FCA) with the Property Ombudsman reporting to them. Also, and putting aside the sheer incompetence of a five year project to digitise an unnecessary form like the TA6, the Regulator should open up a conflict of interest investigation into the Law Society’s generation of revenues from official forms that it also mandates use of in the CQS.
For those of us in the tech industries that had to witness the Law Society and CA/HBSG failing to agree a new data schema for Buying & Selling and then going off and developing competing forms, it has been eye opening to the structural flaws in the property industry. With Propertymark running their own form as well, its a mess. A regulator could mandate a single format and schema for both ‘material’, ‘upfront’ and ‘query’ information and impose them on the industry.
Management by Committee – the government should shut down (or ignore) the various industry committees that have done so much to hamper progress in the last 10 years. The HBSG, HBSC, and DPMSG have become what we always called ‘innovation prevention committees’ whose main purpose seems to be to enshrine current bad practice and vested interest in digital form. Worst of all, where they do create something interesting they have no enforcement capability so most of their output is just whimsy (Reservation agreements anyone?) An efficient regulator will make these groups of semi-retired bumblers redundant.
Land Registry – needs to be put into special measures with the senior management all removed from post and frog-marched to the front door with their belongings in a box. Apart from being seemingly unable to deliver against its basic function of registering transactions promptly, this is the organisation that in 8 years has been unable or unwilling to add the UPRN number to its data schema, even though it has been mandated by Govt. The idea that they should be put in charge of any more industry projects, workgroups or committees is risible. They have presided over a decade of dysfunctional mismanagement while other Govt agencies like the Passport Office and the DVLA have become bywords for excellence. (Note: HMLR is still illegally publishing the Price Paid Data even though the ICO has ruled it Personal Finance Information and not covered by the Open Govt Licence (OGL) that HMLR use. This will stop).
Local Land Charges – the LLC project needs to be funded and managed properly or bundled into a wider digitisation project for Local Authorities.. My preference is to take it away from HMLR and give it to a specific team within the Regulator (I would keep it out of LocalGovDigital if we want it to be delivered). In the meantime any council that fails to answer an LLC or Con29 enquiry within 5 days should be fined £1000 with the scale of fine rising with multiple offences.
Access to the other council information used in transactions, particularly Planning and Building Control information must be made available digitally via API to homeowners and their representatives. Only offering ‘website access’ to public was regarded as backwards by the end of the last decade. It has led to an industry of companies illegally scraping council websites which is in no ones best interests.
Estate Agents and Conveyancer – both these functions should fall under the jurisdiction of the the new regulator (see above) and be allowed to offer merged propositions on the high street. Having estate agents and conveyancers both compiling data on a sale is completely wasteful in this day and age. Upfront info packs can be transferred from these merged entities directly to the buyers conveyancer.
The Regulator should mandate that no property can be listed for sale unless all IDs, surveys etc are completed. But once completed, all IDs/AML/KYC check must be transferable between parties and any conveyancer refusing to accept them should immediately lose their licence. All conveyancers should be given 3 years to ensure their IT systems are able to receive a digitised Upfront Information pack or they lose their licence to practice.
Transaction Networks – we appear to have three organisations looking to create the property industry’s equivalent of the Visa, Mastercard and Amex payment networks. The networks being created by Pexa, Coadjute and LMS (and any others that arrive) should be brought under the new regulator in the same way that the FCA regulates the payment networks (via the Payments Systems Regulator – PSR).
Data – getting access to complete information quickly and easily is a foundational step. There has actually been significant progress on digitisation of property information but there is still so much more to be done. This has to be a Government priority There is also one significant exception to progress within all the work that has been done. There is no policy assumption that the homeowner should have direct access to all the data held in public sector or commercial servers about their home. Everything is being done for the benefit of professionals. From the homeowner perspective access to public sector data is still patchy and in some instances costs money. More seriously our property data is being commercialised and abused by property industry players with very little protection or redress offered. The Govt should look at a GDPR for property data.
To be fair, the last decade has not been innovation free. The two significant things to come out of all the meetings has been the Property Data Trust Framework and the National Logbook Register. Both groups are made up almost exclusively of outsides to the industry.
The proposed regulator should set a date to mandate the PDTF for all property transaction data. This would finally force the conveyancers and the CRM companies to adopt it. The Regulator should also follow France, Belgium and other European countries that are mandating digital property logbooks for all properties – particularly for new build. If every home had a digital Logbook with unfettered access to all property records and performance information, and which was capable of producing Upfront Information in PDTF format, we would be a very long way down the road to solving this.
Nigel Walley is CEO of digital property logbook company Chimni and Chair of the Residential Logbook Association. Before launching Chimni in 2017 he ran digital transformation consultancy Decipher for 30 years, working with the BBC, Sky, Virgin, British Gas and many others.
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