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The idea of seller’s packs was first floated in 1999 and the government piloted the system in Bristol. More than 180 people compiled seller’s packs (involving about 20 estate agents) before putting their homes on the market, in a response to a government mailout to 80,000 households. The results of the exercise were mixed.
“It did work, but only in a pure environment,” says Richard Harding of Richard Harding estate agents, which sold the first property put on the market with a seller’s pack. His colleague, Richard Drew, who sold the top-floor flat to Julie Collins and Kristian Morgan, believes that the public was largely ignorant of the packs’ purpose. “It could have been promoted better,” he says. “We spent a long time educating buyers.”
Morgan and Collins were delighted with the seller’s pack. The flat they bought for £150,000 in 1999 has already been back on the market for two months. With the seller’s pack, they had made an offer, exchanged and arranged a completion date within this time.
“Now we’re looking again and are having to go through all the usual misery and pain,” Morgan says.
Michael Wagstaff was the government adviser who ran the Bristol pilot; he is now sceptical, however, about the system’s merits. “The seller’s pack did reduce the time between offer and exchange from an average of 62 days to 48 days,” he says. “But even though the pilot was government-sponsored and the packs were free, people did not want to wait to put their homes on the market. Estate agents were scared by the plans and tried to come up with alternatives.”
Agents are fearful that the seller’s pack could lose them the estimated 30% of buyers who put their house on the market to “test the water” and sell only if they attain a desired price. It is of less concern in a busy market, but could drastically affect a slow market.
“We recognise the government’s commitment to change, but at the end of the day it is whether it is workable in the marketplace,” says Hugh Dunsmore-Hardy, chief executive of the National Association of Estate Agents, which represents more than 9,500 members. “We support the seller’s pack in principle but wait to see the detail.”
In 2000, the government backed away from pushing through seller’s-pack legislation over one main issue: criminality. There was strong opposition in the House of Commons to the idea that home sellers would be held criminally responsible for offering incorrect information to potential buyers.
Last week, Rooker revealed that the plans have now been amended to reflect these concerns. “Having gone as far we did previously with the legislation, we have been able to take a second look and tweaked the proposal to make it more acceptable,” he says. “We have got to be serious about this. We are talking about millions of people selling homes every year and we don’t want to turn them into criminals.”
However, this leaves the fundamental problem that potential buyers and mortgage lenders may be reluctant to trust the results of a survey commissioned by a seller.
A new host of problems may be opened up as well, as vendors might be more likely to sell their homes through estate agents who offer a “gentle” survey through a friendly surveyor.
This is one of the key reasons why Wagstaff has turned from a keen government adviser on the plan to a determined opponent. “The seller’s pack originally came unstuck because why should you believe a survey carried out by the seller?” he says. “There are also concerns over who will carry out all these surveys. There are only about 2,500 surveyors currently carrying out basic surveys but they would need to service 1.4m sellers every year.”
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