Overhaul the system

Dick Turnip

So...having been happily oblivious to the house buying process up until late last year, the last 6 months have been quite the eye opener.

Wondering what changes people think should be implemented to make the sale/purchase more efficient or better. Borrow the best bits from other countries ways of doing things or make up completely new process as you see fit

I'll start (as it is currently affecting me!)

1. Banks should have to provide deeds within 10 working days of receiving letter from solicitor requesting them, or else incur fines. Currently 8 weeks and counting on the house I'm buying..

2. Bidding process should be more transparent. I know some agents now have bids lodged online and you can see the history. I think this should become more common (maybe the shift towards that is already happening?). Hard to shake the feeling that the other bids are phoney when you're bidding.

3. Surveyor's report should be paid for by seller and available at viewings

4. Once house goes sale agreed - contracts must be signed within 45 days.

Now, not sure how feasible any or all of those but thought I'd get the ball rolling. Not looking to discuss the market as a whole, more the mechanics of actually purchasing or selling a house.

houseyhouse

I've often thought that about the survey. We bought at auction (we live in Galway where this is common) and multiple prospective bidders had to pay for surveys but then didn't get the house. Seems like a real waste of money. On the other hand, I think a lot of people might not trust a survey paid for by the purchaser.

2. Hard to see how publishing bids makes it any more transparent. They would not be able to publish the name of the bidder, and nothing to stop seller putting in a few bids to push price up.

3. You want buyers to rely on a survey paid for by the seller?

4. Delays in completion are often due to problems with bank drawdown and legal checks carried out by buyers solicitor, the sellers solicitors are frequently responsible for delays. In these cases, who would get penalised? You can’t fine the buyer/seller if the bank solicitors are responsible for delay.

jimmycrackcorm

Dav010 wrote: »

2. Hard to see how publishing bids makes it any more transparent. They would not be able to publish the name of the bidder, and nothing to stop seller putting in a few bids to push price up.

3. You want buyers to rely on a survey paid for by the seller?

Published bids should not include GDPR information, but should be backed by actual evidence for an audit inspection.

A sellers survey is going to be biased. But it is ridiculous that multiple surveys have to be undertaken by potential buyers.

jimmycrackcorm

jimmycrackcorm wrote: »

Published bids should not include GDPR information, but should be backed by actual evidence for an audit inspection.

A sellers survey is going to be biased. But it is ridiculous that multiple surveys have to be undertaken by potential buyers.

A survey should only be done when a property goes sale agreed subject to survey, why would multiple bidders get surveys?

As I’m sure you know, auctions are very different from standard house sales, if your bid is accepted as the winner, the contract is formed the moment that hammer drops. So understandably, where there is a much higher chance of a bidder winning at auction, the survey should be done before you bid. I definitely would not rely on a survey done by someone else if I knew I would be bound by contract the day I bid.

As far as I’m aware, EAs already have to keep a record of bids for audit, how does publishing bids online make it more transparent?

3DataModem

Copy the scottish system.

You offer a place for sale as "fixed price" and the missives have to be prepared in advance. A buyer can basically buy the house at that price and missives are exchanged, literally within days. https://espc.com/news/post/the-process-of-buying-your-first-home

All offers must be submitted by a solicitor.

Dick Turnip

Dav010 wrote: »

2. Hard to see how publishing bids makes it any more transparent. They would not be able to publish the name of the bidder, and nothing to stop seller putting in a few bids to push price up.

3. You want buyers to rely on a survey paid for by the seller?

4. Delays in completion are often due to problems with bank drawdown and legal checks carried out by buyers solicitor, the sellers solicitors are frequently responsible for delays. In these cases, who would get penalised? You can’t fine the buyer/seller if the bank solicitors are responsible for delay.

2. Hard to see how it could be eliminated but you can't see the name of the bidder currently, but each bidder has a unique ID number from what I've seen. It's still more transparent than just getting told over the phone "that's gone up another €5K"

3. The banks rely on a valuation paid for by the buyer as an example. There could be a database of surveyors, the buyer could choose one from this list after going sale agreed, the seller pays for survey.

4. Yes, hard to change or police as there's a lot of moving parts. Sellers advertising a house for sale before it has cleared probate could be banned for example. Or buyers going sale agreed before having mortgage approval in principle could be another? Along with the banks taking the piss sending out deeds.

MacDanger

3DataModem wrote: »

Copy the scottish system.

You offer a place for sale as "fixed price" and the missives have to be prepared in advance. A buyer can basically buy the house at that price and missives are exchanged, literally within days. https://espc.com/news/post/the-process-of-buying-your-first-home

All offers must be submitted by a solicitor.

The Scottish system does seem to be better

Dick Turnip

3DataModem wrote: »

Copy the scottish system.

You offer a place for sale as "fixed price" and the missives have to be prepared in advance. A buyer can basically buy the house at that price and missives are exchanged, literally within days. https://espc.com/news/post/the-process-of-buying-your-first-home

All offers must be submitted by a solicitor.

Friends of mine bought in Scotland the year before last. Must ask them about it in more detail soon. I remember at the time thinking the system was different there alright.

From memory they had to submit their bid on a certain date along with other interested parties and they had one shot at it basically, no back and forth for weeks or months with ever increasing bids.

The seller could go with a lower offer if they preferred, (if it was in cash vs mortgage for example).

edit - just read the article you linked, my friends must have been involved in one that had a closing date and "offers over" price advertised. Much better system.

Dick Turnip

Dick Turnip wrote: »

2. Hard to see how it could be eliminated but you can't see the name of the bidder currently, but each bidder has a unique ID number from what I've seen. It's still more transparent than just getting told over the phone "that's gone up another €5K"

3. The banks rely on a valuation paid for by the buyer as an example. There could be a database of surveyors, the buyer could choose one from this list after going sale agreed, the seller pays for survey.
.

2.It might give the illusion of transparency, but it is no less open to abuse.

3. Maybe if you put a caveat that the buyer has to place a deposit equivalent to the cost of survey, which they lose if they do not complete.

Dick Turnip

Dav010 wrote: »

2.It might give the illusion of transparency, but it is no less open to abuse.

3. Maybe if you put a caveat that the buyer has to place a deposit equivalent to the cost of survey, which they lose if they do not complete.

Yeah, I know it would be open to abuse. And if I was buying under that system I would be very nervous relying on a seller's survey.

I went sale agreed on a house last year, paid surveyor, and in fairness it was money well spent as his report showed serious issues with roof & rising damp. So I pulled out. I just thought after when I saw it on the market for the same price that it's a bit of ridiculous situation that someone else will come in and pay for another surveyor to come in only to be told the same thing. Obviously, they may well decide it's worth the risk and proceed.

godtabh

Why would you rely on a report the seller paid for? I'd rather my own piece of mind

jester77

Living in Germany and the process I went through was painless. It was a new site, company already had an office set up at it. Paid a visit, went through the plans. Paid a €50 deposit, house reserved for 2 weeks. Visited some of their previous sites that had existing show houses, and was happy with what I saw. I called my finance guy to get some mortgage quotes, visited some other finance places on recommendations from friends. My finance guy had the best deals. Signed the contract with the house 2 weeks later, bank came to my office to sign the papers and that was it. No bs anywhere and it was all wrapped up in a short time period. Moved in 8 months later.

Dick Turnip

jester77 wrote: »

Living in Germany and the process I went through was painless. It was a new site, company already had an office set up at it. Paid a visit, went through the plans. Paid a €50 deposit, house reserved for 2 weeks. Visited some of their previous sites that had existing show houses, and was happy with what I saw. I called my finance guy to get some mortgage quotes, visited some other finance places on recommendations from friends. My finance guy had the best deals. Signed the contract with the house 2 weeks later, bank came to my office to sign the papers and that was it. No bs anywhere and it was all wrapped up in a short time period. Moved in 8 months later.

Interesting. I was never looking at new builds so have no knowledge of how it works here.

Dick Turnip

Dick Turnip wrote: »

Yeah, I know it would be open to abuse. And if I was buying under that system I would be very nervous relying on a seller's survey.

I went sale agreed on a house last year, paid surveyor, and in fairness it was money well spent as his report showed serious issues with roof & rising damp. So I pulled out. I just thought after when I saw it on the market for the same price that it's a bit of ridiculous situation that someone else will come in and pay for another surveyor to come in only to be told the same thing. Obviously, they may well decide it's worth the risk and proceed.

Therein lies another potential problem, all surveyors, I presume like other professionals, are not equal. I’m sure a buyer would have a clause insisting they would not be liable for omissions in the survey. If a buyer pays for a survey and it’s found to be negligent, you can take it up with the surveyor, but if the report was prepared for the buyer and given to you free of charge, I don’t see how you could have any comeback.

Dick Turnip

godtabh wrote: »

Why would you rely on a report the seller paid for? I'd rather my own piece of mind

Yeah, I'm not 100% advocating for the seller to be the one to pay it and I'm sure if the norm was that the seller pays, then I'd be on here say "it's ridiculous, how can you expect to trust a report that the seller is paying for"!

jester77

Dick Turnip wrote: »

Interesting. I was never looking at new builds so have no knowledge of how it works here.

No idea if that is standard or how this particular company works. They are a big house construction company so they would have a good process already in place.

hometruths

Dick Turnip wrote: »

Friends of mine bought in Scotland the year before last. Must ask them about it in more detail soon. I remember at the time thinking the system was different there alright.

From memory they had to submit their bid on a certain date along with other interested parties and they had one shot at it basically, no back and forth for weeks or months with ever increasing bids.

The seller could go with a lower offer if they preferred, (if it was in cash vs mortgage for example).

edit - just read the article you linked, my friends must have been involved in one that had a closing date and "offers over" price advertised. Much better system.

+1 for the Scottish ‘offers over’ system. No messy bidding wars worried about phantom bids - you bid what it’s worth to you and you either get it or you don’t. Also removes the need for EAs, and their fees. All the details and bids can be handled by a solicitor. It’s a brilliant system.

jimmycrackcorm

Dav010 wrote: »

A survey should only be done when a property goes sale agreed subject to survey, why would multiple bidders get surveys?

As far as I’m aware, EAs already have to keep a record of bids for audit, how does publishing bids online make it more transparent?

My ex went sale agreed buying, had a survey done and withdrew after finding out the neighbours were junkies and their kids messed around in the garden of the house she was going to buy.

I didn't mention publishing bids online, but for audit purposes, I specifically meant traceable bids, i.e weed out the phantom ones

Dick Turnip wrote: »

Interesting. I was never looking at new builds so have no knowledge of how it works here.

My own home was a new build - into the site office, pick the house, pay a deposit. First come, first served. The builder released the house across the street the following day, they were an extra 6k overnight due to the demand.

jimmycrackcorm

jimmycrackcorm wrote: »

My ex went sale agreed buying, had a survey done and withdrew after finding out the neighbours were junkies and their kids messed around in the garden of the house she was going to buy.

I didn't mention publishing bids online, but for audit purposes, I specifically meant traceable bids, i.e weed out the phantom ones



My own home was a new build - into the site office, pick the house, pay a deposit. First come, first served. The builder released the house across the street the following day, they were an extra 6k overnight due to the demand.

Aren’t EAs required to keep a list of bidders for audit currently?

Edit: They are, PSRA require that all licensors must keep a record of offers on the property which can be checked by the Authority

Jimmy it’s surprising the number of threads/posts from people complaining about EAs/sellers wanting confirmation of funds and personal data from bidders before a bid can be accepted for consideration. Personally I don’t think any bid should be made/considered without mortgage approval/ proof of funds.

Dick Turnip

Dav010 wrote: »

Aren’t EAs required to keep a list of bidders for audit currently?

I think so yes

pleh

1. Banks should have to provide deeds within 10 working days of receiving letter from solicitor requesting them, or else incur fines. Currently 8 weeks and counting on the house I'm buying..

I agree and I want to add
Why isn't the request for deeds more transparent.
You can only hope the sellers solicitor requested them and you don't know if the bank got the request or how long it takes.

Marcusm

houseyhouse wrote: »

I've often thought that about the survey. We bought at auction (we live in Galway where this is common) and multiple prospective bidders had to pay for surveys but then didn't get the house. Seems like a real waste of money. On the other hand, I think a lot of people might not trust a survey paid for by the purchaser.

There was a proposed reform in England & Wales (not Scotland) back in late 90s/early naughties which involved a seller’s pack which would have included a survey which buyers could rely on. When ultimately introduced it included little more than a BER cert. the surveying profession needs to be stronger and accept true liability before there can be any reliance on a. Sellers survey.

Gumbo

Dick Turnip wrote: »

So...having been happily oblivious to the house buying process up until late last year, the last 6 months have been quite the eye opener.

Wondering what changes people think should be implemented to make the sale/purchase more efficient or better. Borrow the best bits from other countries ways of doing things or make up completely new process as you see fit

I'll start (as it is currently affecting me!)

1. Banks should have to provide deeds within 10 working days of receiving letter from solicitor requesting them, or else incur fines. Currently 8 weeks and counting on the house I'm buying..

2. Bidding process should be more transparent. I know some agents now have bids lodged online and you can see the history. I think this should become more common (maybe the shift towards that is already happening?). Hard to shake the feeling that the other bids are phoney when you're bidding.

3. Surveyor's report should be paid for by seller and available at viewings

4. Once house goes sale agreed - contracts must be signed within 45 days.

Now, not sure how feasible any or all of those but thought I'd get the ball rolling. Not looking to discuss the market as a whole, more the mechanics of actually purchasing or selling a house.

3. Not a chance. The survey should be Independant from the seller. Same way you buy a car and let the sellers mechanic tell you it’s perfect. You check it yourself.

bob mcbob

schmittel wrote: »

+1 for the Scottish ‘offers over’ system. No messy bidding wars worried about phantom bids - you bid what it’s worth to you and you either get it or you don’t. Also removes the need for EAs, and their fees. All the details and bids can be handled by a solicitor. It’s a brilliant system.

A few details about the Scottish system
- "offers over" price is typically what the home has been estimated at - this is (100% max) of a mortgage a bank will offer. So anything over this needs to be cash from the buyer. This tends to limit house price inflation.
- When the solicitor makes the bid, it is legally binding so if it is accepted then a contract has been agreed. Guzumping is not possible as it is breech of contract.
- each seller has to produce a basic (standard) survey but buyers can still do their own more detailed survey - this is then written into the bid from the solicitor (ie bid is dependent on successful survey outcome)

Dick Turnip

bob mcbob wrote: »

A few details about the Scottish system
- "offers over" price is typically what the home has been estimated at - this is (100% max) of a mortgage a bank will offer. So anything over this needs to be cash from the buyer. This tends to limit house price inflation.
- When the solicitor makes the bid, it is legally binding so if it is accepted then a contract has been agreed. Guzumping is not possible as it is breech of contract.
- each seller has to produce a basic (standard) survey but buyers can still do their own more detailed survey - this is then written into the bid from the solicitor (ie bid is dependent on successful survey outcome)

Sounds ideal compared to Irish system so

Del2005

Marcusm wrote: »

There was a proposed reform in England & Wales (not Scotland) back in late 90s/early naughties which involved a seller’s pack which would have included a survey which buyers could rely on. When ultimately introduced it included little more than a BER cert. the surveying profession needs to be stronger and accept true liability before there can be any reliance on a. Sellers survey.

What's to stop a seller getting a survey done and then drastically altering the property? Would you spend several hundred thousand Euro based on a report that could be out of date and paid for by the vendor?

Dick Turnip

Yeah, I think whatever benefit there is of a seller paying for a survey, is far outweighed by prudence and piece of mind for the buyer to do it anyway.

Claw Hammer

Dick Turnip wrote: »

Sounds ideal compared to Irish system so

The problem is that title investigation and survey have to be done beforte bidding. If the title or survey aren't satisfactory, no bid will be made and the money expended has been wasted.

CelticRambler

Here in France, the process is very streamlined (although very tough on estate agents): seller places the house on the market with an asking price, either as a private sale or through an agent. The advertised price is net seller, but has to include any surveys/energy reports/other obligatory studies. Agency fees are (nominally) paid by the buyer.

If a buyer offers the asking price (in writing), the sale is agreed there and then; the buyer has a 7-day cooling off period, but the seller cannot back out without incurring a penalty of 10% of the asking price. Anyone can offer less than the asking price, and the seller is free to accept or refuse such an offer - but if they decided to accept it, the same rules apply: no backing out afterwards, just because someone else has expressed an interest.

Other than energy ratings and surveys for asbestos and termites, it's actually very uncommon here for structural surveys to be carried out. As the other two have to be done (in principle) before the house is placed on the market, the sale process can be very quick. Both parties go through the same independent notary, so if he/she has his act together, there's no messing around: price agreed -> fix a date to meet up in the notary's office -> arrange transfer of funds -> pick up keys. If you don't need a mortgage, it's not unusual for the exchange of funds/keys/deeds to take place on Day 8 - the first day after the buyer's cooling off period expires.

Dick Turnip

CelticRambler wrote: »

Here in France, the process is very streamlined (although very tough on estate agents): seller places the house on the market with an asking price, either as a private sale or through an agent. The advertised price is net seller, but has to include any surveys/energy reports/other obligatory studies. Agency fees are (nominally) paid by the buyer.

If a buyer offers the asking price (in writing), the sale is agreed there and then; the buyer has a 7-day cooling off period, but the seller cannot back out without incurring a penalty of 10% of the asking price. Anyone can offer less than the asking price, and the seller is free to accept or refuse such an offer - but if they decided to accept it, the same rules apply: no backing out afterwards, just because someone else has expressed an interest.

Other than energy ratings and surveys for asbestos and termites, it's actually very uncommon here for structural surveys to be carried out. As the other two have to be done (in principle) before the house is placed on the market, the sale process can be very quick. Both parties go through the same independent notary, so if he/she has his act together, there's no messing around: price agreed -> fix a date to meet up in the notary's office -> arrange transfer of funds -> pick up keys. If you don't need a mortgage, it's not unusual for the exchange of funds/keys/deeds to take place on Day 8 - the first day after the buyer's cooling off period expires.

Wow - 8 days! :eek: That is quick!!

CelticRambler

Dick Turnip wrote: »

Wow - 8 days! :eek: That is quick!!

These sales would tend to be flats and small urban houses with no complications. When you get out into the countryside, there are things that can slow the process down - usually a house owned by half a dozen children/grandchildren, all of whom have to physically sign the Deed of Sale and post it back to the notary. Or the sale might be conditional on the seller clearing 500 years' worth of junk out of the attics and barns and stables and cellars, so they might want more than a week to do that!

Also, if a country house comes with a significant parcel of land, all the neighbouring farmers have first dibs on it, and they're given up to three months to decide whether or not they want to/can find the funds for the purchase (has to be at the price agreed and for the whole property, they can't just slice off all the garden and leave you with a house standing on 10m² of concrete). In town centres, the local council frequently has first dibs on any property that comes up for sale too, but canny sellers will know how much the council an afford to pay and price it higher than that.

All-in-all, though, simply knowing that the house is yours, once your offer has been accepted, makes a huge difference. Taking all the circumstances into consideration, once you've paid your deposit, you can fix a date for moving and know that it's almost certainly going to be respected.

blackbox

Buying a house is an auction in everything but name.

Just like buying something in a shop, the seller should have to accept the first offer that meets the asking price and any conditions of sale. Bidding should only be permitted below the asking price.

If not happy with this, they have the option of selling by auction.

blackbox

blackbox wrote: »

Buying a house is an auction in everything but name.

Just like buying something in a shop, the seller should have to accept the first offer that meets the asking price and any conditions of sale.

If not happy with this, they have the option of selling by auction.

A shop does not have to accept the first offer that meets the asking price, they choose to do so.

blackbox

Dav010 wrote: »

A shop does not have to accept the first offer that meets the asking price, they choose to do so.

If a shop has a bottle of wine priced at 10 euro, they cannot say "Oh, I'm waiting to see if I can get 12 for it" - they must sell it for the advertised price. (They can refuse to sell it if the buyer is underage.)

blackbox

blackbox wrote: »

If a shop has a bottle of wine priced at 10 euro, they cannot say "Oh, I'm waiting to see if I can get 12 for it" - they must sell it for the advertised price. (They can refuse to sell it if the buyer is underage.)

They can refuse to sell to whomever they want (as long as it is not on the grounds of discrimination) Items for sale in a shop at an advertised price is an invitation to treat, that does not mean the shopkeeper is required to sell to you just because you offer the advertised price.

And, until the offer is accepted, there is nothing preventing the shopkeeper walking down the isle and changing the “0” to a “2” on the advertised price.

Claw Hammer

blackbox wrote: »

If a shop has a bottle of wine priced at 10 euro, they cannot say "Oh, I'm waiting to see if I can get 12 for it" - they must sell it for the advertised price. (They can refuse to sell it if the buyer is underage.)

Not true. A price is only an invitation to treat. There is noi obligation to sell for the price marked.

Gumbo

blackbox wrote: »

If a shop has a bottle of wine priced at 10 euro, they cannot say "Oh, I'm waiting to see if I can get 12 for it" - they must sell it for the advertised price. (They can refuse to sell it if the buyer is underage.)

Sorry your wrong.
The advertised price on the shelf is an invitation to tender.

If the price is different at the till, it’s up to you to pay it or put it back.