tm blog

Planning data can cause delays and frustrations

When someone is planning on buying and then renovating their new home, planning data can throw a spanner in the works. Client queries can be time-consuming and costly.

It can be hard to ascertain what exactly your client wants when it comes to planning. They may be unsure themselves or think what they want won’t need permission. In addition, large volumes of data can be confusing for the home buyer and could mean vital information about their purchase is missed. 

How RiskView Residential is being enhanced to solve your planning data problems

RiskView Residential is an all-in-one environmental report that delivers easy-to-interpret data. It covers the key risk areas of contaminated land, flood, ground hazards and energy and infrastructure.

From January 3rd 2020, RiskView Residential will include planning applications and planning constraints data. 

By including planning in with RiskView, Landmark has focused on efficiency by removing easily solved client queries. 

Landmark has enhanced their simple to use, dynamic online viewer. Your client can use the new date filter to evaluate what’s important to them. You might be surprised that out of hundreds of planning applications, your client is only interested in a few. Now they can save time and quickly focus on what matters most.

Within the report, the number of pages in RiskView has been kept to a minimum – placing the large, home-buyer centric data in the online viewer. This ensures you don’t have to review or print dozens of pages unnecessarily.

Information in a click

The RiskView online viewer has also been enhanced to include (where possible) a clickable weblink for recent planning applications. 

Together, RiskView’s new features reduce the time it takes to evaluate planning data and the number of enquiries by removing the complexity and volume of the data presented.

Planning constraints data is also included, providing invaluable insight for your home-buyer client to determine if nearby constraints are likely to have an impact on future plans or marketability. Using the online viewer, home buyers can see if planning has been refused in the area. They can also see if any recent applications could (in their opinion) have an impact on the location.

By arming homeowners with this data, you are helping them choose their future home, with real, factual information.

Together, RiskView’s timesaving features add value to your service. You are also reducing the time spent dealing with planning related enquiries. 

Providing complete environmental due diligence with professional opinion in one report, RiskView is the market leading choice in client care.

RiskView with planning includes:

•Planning applications as standard

•Planning application summary on one page in the report

•Online viewer designed to reduce time spent on planning queries

•Unique dynamic date filter

•Planning application clickable links

•Planning constraints

To find out more about how RiskView Residential can save you time, please contact our Client Services Team on 0800 840 5571 or helpdesk@tmgroup.co.uk

Landmark’s RiskView Residential Report with Planning – Coming Jan 2020

Landmark’s RiskView Residential Report will include planning applications and planning constraints data. By including planning in with RiskView, Landmark is looking to drive efficiency by addressing easily solved client queries that arise around planning. 

Their online viewer will have a new date filter, include a weblink for recent planning applications, and continue to highlight the homebuyer-centric data that matters, reducing the time needed to evaluate a now more streamlined data set

Providing environmental due diligence with professional opinion in one report, RiskView comprises:

• Planning applications as standard
• Planning application summary on one page in the report
• Online viewer designed to reduce time spent on planning queries
• Unique dynamic date filter
• Planning application clickable links
• Planning constraints

Groundsure’s Mine Entry Report (MER) – Now free!

In September Groundsure launched its follow-up report to the Groundsure CON29M Official Coal Mining Search:  where mine entries (shafts and adits) are identified within 20m of a property, the CON29M recommends that they are investigated further through this interpretative report.

As of now, the follow-up can be ordered from tmconvey at no additional cost.

It may be free but it’s still invaluable. The MER provides an assessment of the ground movement risk associated with mine entries, provided by an experienced and qualified consultant from Mining Searches UK using a variety of data sources. 

It includes:

• A clear statement of risk associated with mine entries within 20m of the property 
• Further details provided on each mine entry
• The calculated impacted area - the zone of influence - for each mine entry 
• Where appropriate, connecting underground roadways are included
• An OS MasterMap site plan displaying the zone of influence of each mine entry 
• Guidance on next steps in the event of subsidence damage 

If you have any questions, please get in touch with your Account Manager or our friendly Helpdesk team on 0800 840 5571 or helpdesk@tmgroup.co.uk

A very recent addition to tmconvey but worth an early reminder. You can now print out a list of the search alerts for a case – previously lists were just displayed but your feedback has told us that this often resulted in users having to take screen shots if they wanted to pass the information on to a solicitor. So much quicker and easier now!

Setting a default plan is one of those tiny bits of functionality that deal with the big annoyance of being asked repeatedly about something!  

If both plans are left as ‘Set as default’ when ordering searches you will always be asked to select which plan, which we appreciate can become frustrating. But if you mark one as Default, then it will be associated automatically. No more asking.

Even better, if you already have searches in draft you will get the option below for even greater convenience.

The 2022 Commonwealth Games development in Birmingham will be funded by a budget of £778 million and is intended to deliver benefits to the area for years to come.

The build is noteworthy for several reasons, not least because of the tight turnaround time and the ambitious scale of the project. Innovation has been key in the planning stage, with Birmingham City Council taking on the project themselves rather than engaging a developer. 

By taking lessons from the developments of other similar events, the local authority has based its plans on proven successful strategies. The key goal is to create not just a world class stadium and village, but to stimulate long-term growth in the area that will transform it permanently.

Regeneration of Perry Barr is being kick-started by a development of more than 1,100 new homes on the former Birmingham City University (BCU) campus.  These homes will form the residential element of the Athletes’ Village before being retrofitted for residential use.  A mix of tenures and property types will be provided in the legacy scheme, including an ‘extra care’ development for older people with varying needs. 

Fast implementation of the plan

Birmingham was awarded the Games in December 2017, meaning they had just four years, as opposed to the usual seven years, to plan, build and host the games. With no room for slippage, it was vital that each stage of the development run smoothly.  The development embodies good practice – from site assembly, through planning, communication with stakeholders, and the legacy benefits it will bring. 

The development is situated within Perry Barr, which is identified as an area for growth in Birmingham’s Development Plan, on a site already identified for residential development following the relocation of the BCU.  Key principles, or ‘big moves’ were identified early and have guided the design of the scheme.  It is approximately one mile from the Alexander Stadium, which will host the opening and closing ceremonies and athletics competition during the Games, and on a main arterial route, making it an ideal location to provide the Athletes’ Village.

To deliver to tight deadlines required significant resource, effort and collaboration, with major hurdles such as planning permission, demolition and remediation, appointment of a contractor, and start on site all smoothly navigated.  Just twelve months on from being named Host City, the residential scheme was granted planning consent.  A second phase of residential development, some 500 homes which will be delivered after the Games, was granted outline consent in August 2019.  At the same time, demolition of former university buildings was underway, and completed in early summer 2019.  Land acquisitions saw the Council working in partnership with Homes England and Department for Education, in both cases agreeing land swaps that facilitated the needs of the agencies.  

Development by the Local Authority

Birmingham City Council is acting as developer, reducing time spent in procuring a development partner, and has appointed a lead contractor through a public sector procurement framework.  The ability to commission a range of specialists through frameworks has minimised time spent on procurement across the project.

Engagement with the local community and other stakeholders early in the process has minimised challenges along the way.  It has also helped position the scheme as part of a bigger opportunity for the longer-term transformation of Perry Barr.

Considering the future

The eleven days of competition during the Games will be exciting, but it is the opportunity this offers as a catalyst for wider growth – and in attracting funding – that is particularly important.  Birmingham City Council has obviously done its homework on past events prior to making any concrete decisions.  Having liaised with decision makers for Manchester Commonwealth Games 2002, London Olympic Games 2012 and even the Gold Coast Commonwealth Games 2018, the Council was well placed to ensure they took away the key success from each event and applied them to the local circumstances.

It is this legacy vision – which includes the redevelopment of the local station and bus interchange, Sprint bus rapid transit, significant reconfiguration of the highway network, cycle and walking enhancements, and further new residential and commercial development – which Government bought into in awarding £165m of grant funding for the regeneration of Perry Barr.

These wider sustainable transport and placemaking interventions, which also include significant land acquisitions to directly enable post-Games development, are vital in creating the market conditions for a successful scheme.  The creation of a distinctive and attractive urban destination will improve the viability of future housing schemes, unlocking a range of other sites in the immediate vicinity.  It is envisaged that the Council’s interventions will directly enable some 2,200 new homes in the area (including the 1,100 referred above) and help unlock a further 2,900 over the next 20 years.

Whilst Birmingham City Council and the Commonwealth Games may carry more influence than smaller projects, it is clear that all key stakeholders working effectively together has resulted in the efficient creation of the development. This is something that other developers could adopt, to achieve similarly impressive results.

In October 2018, the government announced that it would appoint a New Homes Ombudsman (NHO) to support homebuyers facing problems with their newly built home. In July 2019 , the Ministry of Housing, Communities and Local Government launched a consultation process seeking views on delivery of the service.

It is also considering whether a code of practice should be created to give a clear framework for both builders and the NHO.

Why a New Homes Ombudsman is needed

The National New Home Consumer Satisfaction Survey, published in March 2019, found that 99 percent of those who bought a new home in 2017/18 reported a defect or snag to the builder, up from 91 percent in 2011/12. The number of buyers who would not recommend their house builder to a friend was 13 percent in 2017/18, up from 9 percent in 2011/12.

Shelter and YouGov found that 51 percent of new home owners have reported major problems with their properties including construction issues, lack of finishing and utility faults.

As well as problems with the build, consumers are also struggling with misleading marketing materials, lack of pre-purchase information and limited transparency in respect of costs and referral fees.

Most buyers would welcome access to their new property before completion, for themselves as well as their own independent surveyor or building consultant. Currently this is often refused.

With the government wanting builders to supply up to 300,000 new homes each year by the mid-2020s, an NHO will encourage high standards and provide recourse for buyers who are dissatisfied.

The government understands that house building is a complex process, involving many different trades and skills and that there may be flaws in newly constructed properties, but it wants to reach the point where all builders deal with problems quickly and treat buyers fairly.

Along with the NHO, a new consumer code has been suggested. While there are a number of codes already in existence, they currently have different standards and criteria, meaning consumers struggle to pin builders down when a problem arises. Complainants may have to deal with different consumer codes and warranty providers as well as the building company to try and have problems rectified.

When purchasers are uncertain who to turn to for redress when defects are not dealt with, some builders are able to continue providing homes of less than adequate quality.

Builders who are expelled from one code are free to join another by using a different warranty firm. This means they do not have to raise their standards. By providing a single point of access for the consumer, bringing a complaint will be simpler and builders will not be able to change to a different system to avoid ongoing sanctions.

The proposed role of a New Homes Ombudsman

The government’s consultation paper, ‘Redress for Purchasers of New Build Homes and the New Homes Ombudsman’, suggests that the initial role of an NHO would be to try and resolve disputes informally. The process is then likely to move on to try and bring complaints to a conclusion by way of recommendations for redress and possible financial awards to the consumer.

The NHO will not have the power to impose fines or instruct developers in the way that they work, however they could be given the power to expel or suspend them from the scheme, meaning they would no longer have the right to build and sell properties.

The government will set an upper limit to the amount that can be asked for by way of financial award, so the most serious claims will still need to go to court for settlement if the sum sought is higher than the NHO’s limit.

In cases where the NHO will not be making a binding decision, there is the option for it to make a recommendation to the developer, for example to buy back a defective property, to vary an unfair lease or to reduce onerous service charges.

Where remedial action is proposed, the NHO could be given the power to impose time limits on completion of the work.

A code of practice

A single, industry-wide code of practice for new build would ensure that builders understand what is expected of them and give the NHO a standard to which they can refer when assessing complaints. 

A code would cover areas including complaints procedures, ethics and conduct, particularly in respect of advertising and provision of clear pre-purchase information, transparency with regard to reservation fees, standards in respect of handover of the property, aftersales service for two years following completion, quality of the build, remedy of defects within a reasonable time frame, customer service standards and provision of a warranty. 

How a New Homes Ombudsman will benefit builders

The proposed new industry regulation is good news for builders who offer higher quality build standards and service than competitors. As those offering a substandard product are penalised and even prevented from selling, those who pay attention to detail and deal quickly and efficiently with snags will rise to the top.

The future looks likely to be more transparent for buyers, with publication of complaints figures, the names of those failing their customers and annual summary reports. The government believes that this openness will improve standards across the industry.  

The New Homes Ombudsman and conveyancers

Conveyancers are likely to notice some differences once the NHO is in place, with possible options to delay completion until a buyer has had a satisfactory survey as well as provision of more information in respect of warranty provisions, leasehold charges and information on future nearby developments.

By ensuring they have adequate case management systems in place, it should be routine to accommodate the extra work as a standard part of a new build transaction once the NHO and code of practice are in place and it is clear what is expected of a developer.

Summary

In April 2019, James Brokenshire, Housing Minister at the time, said it was the government’s intention to introduce the NHO in shadow form before its formal launch. This will give builders and the NHO the opportunity to see how the scheme will work and make any adjustments necessary before a national roll-out.

The Minister also emphasised the government’s wish for high quality, well-designed homes that are beautiful, stand the test of time and provide what communities want and need.

The government’s vision of the future is one where standards are higher, developers offering poor quality are forced to improve or leave the industry and the customer can be assured of prompt and satisfactory resolution of problems. Builders who rise to meet the new standards should find their efforts rewarded as they spend less time resolving post-completion difficulties and benefit from good ratings and recommendations.

The government’s commitment made in 2017 to build 300,000 new homes per year has been well documented. Two years down the line, although the numbers are falling short of the goal, the future looks positive for the new build industry. 

In the year ended June 2019, 173,660 builds were completed, 8 percent more than in the previous year. Private new build completions were 7 percent higher than the previous year, and housing association completions were 12 percent higher.

At present, the amount of new properties being built each year is higher than the number of new households being set up over the same twelve-month period. A new household is formed, for example, by children leaving home to live in their own property, or by couples separating to form two households where previously there was one. The Office for National Statistics estimated in 2018 that the number of new households per year will be 159,000. Even factoring in a possible post-Brexit slowdown in building, construction is likely to continue to substantially outstrip the new households figure. 

Government strategy 

In October 2018, the government revisited its pledge of the previous year and stated that it was committed to delivering 300,000 homes per year by the mid-2020s. This was accompanied by suggested reforms designed to improve the planning process and deliver investment where needed.

New permitted development rights allow larger extensions and building upwards from existing properties, while development and land acquisition rules are to be made clearer in respect of the creation of new towns and garden communities. 

It is also intended to allow Local Authorities to sell surplus land and develop more brownfield sites.

The government recently announced in August 2019, its intention to provide £600 million of new money via the housing infrastructure fund towards the building of 50,000 new homes in five high-demand areas in London, Bedfordshire and Essex, along with accompanying infrastructure and public services. This is in addition to the £1.3 billion already allocated to 76,500 homes.

Quality will be important, following former housing minister Kit Malthouse’s claim that much of the homes being built now will soon be ripped down and bulldozed as unsuitable. The Building Better, Building Beautiful Commission has been set up to tackle the challenge of poor-quality design and build. Its recent interim report, published in July 2019, has started defining proposals to ensure that future builds are beautiful, sustainable and designed to meet people’s needs.  

Future developments 

As well as new build on vacant land, unused retail space is likely to be made more widely available for residential development. Online shopping accounted for 18 percent of all UK retail sales in 2018, with over 2,400 stores closed on the top 500 high streets that year as well as units on larger out of town retails parks becoming vacant. Local Authorities have been reluctant to grant permissions for change of use in case of a future upturn in retail fortunes, but if the downward trend continues it is likely that more retail space will be released.

Creating mixed developments helps retail sectors thrive, by bringing in homes alongside shops and restaurants. A return to more traditional designs of high streets with public squares is happening in some areas, with different architects being brought in to design different blocks to provide visual variety.

London developments are leading the way with innovation, with the canalside site at Fish Island Village combining a social enterprise campus providing working space for local creatives with one, two and three bedroom homes.

The older generation continues to increase in number, with households headed by someone aged 65+ estimated to account for 88 percent of growth from 2016 to 2041. The government is keen to see more later living accommodation built and intends to give greater encouragement to developments by ensuring that suitable sites are made available to a wide range of developers.  They want older people to be able to choose from a range of housing options, including retirement and care homes. This in turn would bring larger family homes onto the market as older people move to more appropriately sized accommodation. 

Newly built social housing figures remain low, with councils now preferring to target funding towards affordable housing. Part of the reason for this is the higher rents payable for affordable housing, typically 80 percent of the standard market rate, as opposed to social housing where rents are just 50 percent. Local authorities, particularly in the South East, are setting up their own housebuilding companies to combat lack of council homes, with profits from the sale of full-priced new build homes paying for construction of new social housing. 

The number of affordable homes being built is rising as councils insist developers include a number within larger developments. In 2017, the number was up 11 percent on the previous year to 53,572. 

With many younger buyers struggling to afford to buy a home outright, more co-living developments are being designed, with hotel-sized rooms for each resident together with shared spaces. These are designed as a solution primarily for the younger generation, who can benefit from shared amenities and leisure spaces and live within a community. The developments are designed to be a step up from shared houses. 

The new ‘green standard’ 

In October 2019, the Housing Secretary unveiled a new green standard for all new build homes, aimed at cutting carbon emissions for future generations.

The Future Homes Standard, as it will be known, will ban gas boilers and other fossil fuels from new homes by 2025, instead requiring builders to install cleaner heat sources such as solar panels or air source heat pumps, to cut carbon emissions by up to 80 percent. Stronger building regulations will also be implemented to reduce the carbon footprint.

Local Authorities are now expected to produce their own design guide, reflecting the unique setting, character and history of their area, to ensure that developers build attractive, well-designed homes that suit their locale.

It is also intended to reform the planning system to make it faster and more efficient. A simpler system will allow Local Authorities to process applications more quickly, benefiting both developers and individual householders who want to extend or modify their homes. Local Authorities will issue their own design codes, setting out the characteristics of well-designed places and demonstrating what good design means in practice.  

New build work for Lawyers 

With residential construction continuing to increase year on year, acting for developers or their buyers is a good target market for property solicitors. However, dealing with a new build purchase can be an onerous task for the conveyancer. The amount of paperwork is substantial and the checklist is long, including checking planning applications, road and sewer agreements, common parts maintenance agreements, NHBC inspections, building regulations approval, access rights, completion requirements and more in-depth checks on the site on which the property is being built, for example in respect of flooding or environmental contamination. 

As well as this, agents and developers can pile on the pressure, demanding a 28-day exchange period or loss of the reservation fee and, potentially, the buyer’s chosen plot. 

Solicitors aiming to take on a substantial amount of new build work in the future can create systems of work around the special considerations required and dedicate staff members solely to this type of conveyancing to ensure a good workflow. Building a good name with developers and agents when it comes to new build is likely to result in more referrals and repeat business. On-site sales teams will be happy to find a conveyancer who understands the pressures their developer faces to keep to a rapid turnover and ensure deposits are received on time.

There are also opportunities to act on the acquisition and sale of part-exchange properties for builders who offer this service. Again, this is a specialised service, as the seller will have no personal knowledge of the property and will need to complete as a matter of urgency to release locked-in funds. 

Summary 

There is much to be positive about in the realm of new build, with increases expected in all areas of residential construction and improvements in the planning system anticipated. As sustainability issues become increasingly important, builders will need to consider environmental impact as well as whether their designs are aesthetically pleasing and suited to the community they serve.

It promises to be an exciting time for developers, as pressure to stop building identikit homes, reduce carbon footprint and the requirement to best utilise available space forces more innovative thinking. For those prepared to take on the challenge of building the homes that people really need, the future looks bright.

With the government aiming to build hundreds of thousands of new homes over the next few years, the current planning trend is not sustainable. The creation of new garden towns and villages offers an attractive option for some of the housing needed, with strong infrastructure provided alongside new homes, meaning less travel and less congestion in nearby towns. 

The current system

Piecemeal planning consents mean that many current new build homes are tacked on to the edges of existing towns and villages. Builders include a minimal amount of infrastructure in their plans, simply relying on that which is already in place. As communities sprawl outwards, those in the new homes need to make car journeys into the town centre to access amenities such as health care, schools and shops, adding to congestion and parking problems.

The town or village residents are opposed to the new development, which takes away the nearby areas of countryside that they value and overburdens the historic centre. New build therefore gains a reputation for ruining traditional communities.

Landowners cash in on owning land around settlements, knowing that theirs is the next property that builders will be able to obtain planning permission for, raising prices. Builders, having paid a high price for the land, squeeze in as many homes as they can, minimising outside space and creating houses with unattractive proportions and tiny gardens.

The garden community solution

What people really want, when buying a new home, is a decent and affordable property, in a strong community with local facilities and a good school. Garden towns could provide this, with small commercial units provided alongside living accommodation. The modest unit size would allow for easy change of use, from retail to office to café, as well as meaning a low rental cost and minimal, if any, business rates.

What constitutes a garden community?

The government defines a garden community as having the following characteristics:

• A new, purpose-built settlement or large extension to an existing town
• A community with a clear identity and attractive environment;
• A mix of homes, to include affordable and self-build

The stated aims include;

• Job opportunities;
• Green space and public areas;
• Provision of roads, buses and cycle routes;
• Provision of schools, community and health centres;
• Long-term stewardship of community assets.

Advantages of garden community living

Done properly, the garden community provides a vibrant, mixed-use environment with an attractive and functioning centre, public areas and the capacity for future growth. It should also be self-sustaining, meeting many of the residents’ needs locally, including schooling, health care, shopping and dining. 

Travel should be possible by walking, cycling, rapid transit or park and ride, thereby cutting congestion. By situating the new community away from existing towns and villages, not only is traffic to those centres kept at a manageable level, but the countryside surrounding them is maintained and the historic nature of older settlements preserved.

While residents of garden communities will still travel to large shopping centres and leisure facilities, the daily journeys to work, school and local shops can be made without adding to traffic problems in existing towns. This will offer a better quality of life for residents than those living on housing estates on the outskirts of busy towns, where traffic to the centre is increasingly slow.

By including smaller units for retail and other commercial use, the community will be assured a variety of independent shops, cafés etc. as well as offices and creative work spaces.

Policy needs

Much national policy is now in place. My Garden Village proposals were adopted by Government in 2016, the New Towns Act updated in the following two years, and further supportive updates to the National Planning Policy Framework just this year. 

For the country to benefit from new garden towns and villages, as well as protecting existing historic communities, best practice is Local Authorities working to put local plan policy in place to set out the key criteria they will require to support new settlements around placemaking, community infrastructure, and mixed use. 

Often, landowners will willingly cooperate, but need to understand that land value needs to reflect the need for this placemaking investment – on land that otherwise only has agricultural value. But where landowners won’t accept this, they need to bear in mind that the updated New Towns Act has made it quicker and easier for Local Authorities to acquire agricultural land at existing use value for larger new settlement proposals. 

Either way (and working with land owners is likely to be preferred in most cases),  the key is that this is land otherwise holding only agricultural value as it is not on the edge of town – and capturing part of the value uplift of development permission to create the needed infrastructure and community place making of a 21st century market town or village is the ‘price’ of the right to build these homes. So Local Authorities need to make it clear that planning consents will only be granted if the community needs are met within the proposals. 

Large scale strategic planning will be needed to put together a garden community proposition. The authorities should consider proactively seeking out suitable land, and landowners and communitiers need to know this scale of proposal will only happen with the right infrastructure and great placemaking – that’s the difference this approach brings.

Government support

The government’s second “Garden Communities” prospectus, published in August 2018, expresses clear expectations of quality, following the Garden City principle. Funding of £2.85 million has been put aside to support the development of 19 new garden villages, creating 73,554 homes. In February of this year, £9 million was put towards existing garden community projects, to try and speed up planning work. The following month, the government announced £3.7 million towards five new garden towns set to provide 64,000 homes, with the funding going towards planning consent work, specialist surveys and less profitable parts of the infrastructure build. In total 43 new Garden Towns and Villages have now got official government support since the policy was adopted in 2016 – to deliver more than three quarters of a million new homes. Many more are under consideration.

In summary

The garden community is just one part of the new build policy that the country needs in order to have enough housing stock for the future. Alongside it, we also need urban regeneration and carefully controlled urban expansion, with sufficient facilities to prevent them becoming simply dormitory extensions.

The creation of new settlements offers a good quality solution for the future. They will offer larger, affordable, pleasant homes with good-sized gardens and an attractive environment combined with a sustainable, economically vibrant town or village centre. When the land has been acquired at low cost, there is more scope to include a variety of premises for small entrepreneurs to open the local shops, cafés and pubs that make historic communities so sought after. The inclusion of basic units will encourage local workers such as plumbers, electricians and accountants to open there, bringing more services and helping the town or village become more self-sustaining. 

If Local Authorities can learn how to support the planning of these new garden communities, they will be able to provide the homes that people really want.

With thanks to Lord Taylor of Goss Moor

In February 2019 The House of Commons released a briefing paper about Improving the Home buying and selling process across England. The paper identified the main concerns with our current home buying and selling process as:

-Time taken to complete a transaction

-Transactional failures 

-Consumer inexperience

-Lack of transparency

-Weak regulation of Estate Agents

-Lack of digitalisation

In October 2019, tmgroup hosted two events in Reading and Liverpool to discuss these challenges and to look at ways the current home buying process can be improved.

Our panel of industry experts looked at creating quality homes, providing modern homes for rent, what the consumer wants from the home purchase process, leasehold reform and how regulation can be aligned across the industry.

Theme 1: CREATING HOMES

How do we provide quality homes for all? 

Lord Taylor of Goss Moor walked us through the history of development planning and some of the key decisions that have led to the rise in sequential development and the negative impact this has on not only the local property market but the local infrastructure. 

He has been involved in creating a Garden Villages and Towns policy for the government and explained the advantages of creating this type of community. By placing the new development at a distance from existing towns and villages and ensuring it has its own infrastructure, to include transport links, community space, schools, health care and shops, car journeys into nearby towns would not be an excessive burden. This is in contrast to much of the current new build planning, where small estates are tacked onto the outskirts of existing towns and villages, with the assumption that they can use the existing town facilities.

Theme 2: RENTING HOMES

Providing habitable homes in multiple occupation (HMOs) – is this just a pipedream?

Vicki Peers (Inside Liverpool) showed us that some investors are creating modern safe spaces for renters. However, while habitable HMOs are possible it can also be costly, which means there are still investors that are cutting corners. So, what can be done to ensure all HMO owners meet the same basic standards?

We asked Vicki for three suggestions to help improve this area of the industry:

More industry education – the new wave of investors is keen to become educated and many attend seminars around the country. If the latest generation of landlords want to remain in property, there should be more CPD/education events they can attend. The only ones currently available are organised by RLA/NLA and are generally focused only on legislation.

Greater experience needed for HMO ownership – currently mortgage lenders are pretty relaxed about the experience necessary to buy an HMO. Simply being a single-let landlord for 1-2 years is enough for most lenders. But HMOs come with many more challenges, both during the refurbishment/development phase, and in the ongoing management. It could, for example, be made a term of the mortgage that a buyer must employ a reputable HMO specialist letting agent, to avoid the DIY attitude of some buyers to keep their costs down.

Regulation of the rent to rent (R2R) model – some investors who don’t have the cash to buy an HMO use R2R, whereby they take control of the house for a landlord and pay an agreed rent, then let out each room individually, retaining the profits. There appears to be little regulation around this and there is a grey area regarding who the HMO licence is held by, how much experience a renter needs to have and what happens to the tenants when the renter/landlord agreement breaks down.

How do we provide quality rental for all?

At the Reading event, Dr David Smith (Anthony Gold Solicitors) identified the main issues surrounding the rental market as:

-Tenant education

-Landlord knowledge and awareness

-Failure to deal with rogues

-Weak powers to deal with property

-Overly complex structures

-Lack of Local Housing Allowance (LHA) skills and findings

-Too many courts and tribunals

David’s three key suggestions to help improve and tackle some of the key issues are;

Better information to prospective landlords at the point of purchase regarding their obligations. Ideally the government would improve their How to Rent Guide, which would be distributed to potential landlords by estate agents and conveyancers.

More awareness of tenant rights and stronger signposting at all levels to existing sources of information such as Shelter.

Governmental approval of the existing private rented sector (PRS) Code and signup from every part of the sector, with some element of compulsion or the ability to deal with those who are not complying with that code. Some of the power to do this already exists but it is not properly implemented.

Panel Discussions

Theme 3: THE HOME PURCHASE PROCESS

What does the consumer really want from a property transaction?

Clear themes from both panel discussions were that the consumer wants certainty, minimal fuss, transparency, information/guidance, confidence in their purchase and finally trust in their investment.

Our panel of experts discussed how this could be delivered, questioning whether increasing the level of information would mean that the consumers would then need more education to understand it all. 

There was a consensus that the value of industry experts and their guidance is undervalued, for example it was noted that many consumers still choose not to have a home survey completed, even though without one a consumer could be around £5k worse off. So why is guidance by the experts sometimes dismissed by the consumer? Is it because the perception is that it isn’t needed?  Should we create an MOT/Service check for the Home Purchase Process? Does more need to be done to enlighten the consumer around the value of the expertise they are paying for? 

Theme 4: LEASEHOLD REFORM

What really caused the ground rent scandal? 

The 2018 report ‘Understanding the consumer experiences of the conveyancing legal services’ by the Solicitors Regulation Authority (SRA) states that 20% of consumers who bought a leasehold property cannot recall being provided with information regarding ground rent, service charges and/or length of lease.

With that in mind, was the ground rent scandal due to lack of information and knowledge? Should the conveyancer have provided more? Or does the consumer have a responsibility to understand what they are purchasing?

Beth Rudolf (Conveyancing Association) and Sebastian O’Kelly (The Leasehold Knowledge Partnership) identified that one way to help improve knowledge about leasehold is to establish a benchmark of information that is provided for any leasehold transaction.

Theme 5: ALIGNED EFFECTIVE REGULATION

How do we align regulation to create a better home process for all?

Regulation is a topic frequently mentioned at industry events. It is a vast and fragmented area, so we asked the panel for their suggestions on aligning it across the property sector with a view to providing the following: 

-A better understanding for the consumer

-More transparency

-Consistent data standards

Panellist: Alan Milstein, Chairman – RPSA

1. Snagging surveys for new build - consumers are disadvantaged by being discouraged from obtaining independent advice about the quality of their new home. We need an industry-wide initiative to create a set of snagging survey standards.

2. Surveys for home buyers - industry terminology and culture does not encourage buyers to commission independent condition reports on their proposed purchase. Property professionals need to understand the value surveys can bring to the process and advise clients of their importance.

3. Surveyor standards have been too low and inconsistent – the Residential Property Surveyors Association (RPSA) are launching the Certified Building Surveyor scheme to ensure that all buyers receive a thorough report that delivers high quality and value for money.

Panellist: Ana Bajri, Associate Director, Internal Standard Team – RICS

1.Consumer education - sharing of consumer education content, resources and information. Cross industry collaboration would ensure consistent messaging and well-informed consumers across the transaction timeline

2.Industry education and information - sharing best practice, who does what throughout the transaction process including information on the roles of professionals involved in the transaction process i.e. conveyancing, surveyor etc., economic statistics on property market, cross- sector training etc.

3. Property industry standards - cross- collaboration to ensure consistency and transparency between professionals and solution providers across the home buying & selling process in delivering high level of service to consumers.

 Panellist: Beth Rudolf, Director of Delivery – Conveyancing Association

1. Adoption of an agreed data model across the industry which technology providers could map to in order to enable the free flow of data between the stakeholders. This would deliver real time chain progress transparency to manage customer expectation and improve the customer experience.

2. Using the Buying and Selling Property Information to aggregate data much earlier in the process, stimulate the use of digital services, reduce additional enquiries and post valuation queries and provide one source of truth that the stakeholders can rely on. Ensure that the buyer has sufficient information prior to offer to avoid a repeat of the leasehold mis-selling scandal.

3. Establish digital identities which all stakeholders could rely upon and which would confirm that the seller was the genuine owner of the property. Also, verification of the source of the buyer’s funds and wealth, eradicating fraud and improving the consumer experience by removing the need to verify identity to multiple parties in multiple ways.

Panellist: David Pope, Entity Authorisation and Client Protection Manager – CILEx Regulation

1. Continuing to work with other stakeholders on how technology can be used throughout the process.

2. Looking at how information can be shared better to improve standards.

3. Restoring the value in the transaction.

Panellist: Eddie Goldsmith, Founder Member – Conveyancing Association

1. Establish a Rulebook synergy across the Conveyancing regulators instead of having three different sets of rules.

2. Create a Legal Services Authority to ensure consistency of regulation.

3. However, having the same set of rules when it comes to retirement/closing a business creates huge barriers and is unfair, so this needs to be taken into account.

Panellist: Paula Higgins, Partner and Head of Operations – Home Owners Alliance

1. Open and transparent communication amongst all parties during the homebuying process, including a clear timeline to help consumers. Technology can help here.

2. Earlier legal commitment from buyers and sellers. Reservation agreements (money down at point of agreed sale) could help here, as well as more upfront information provided about the property.

3. Streamline paperwork and anti-money laundering (AML) requirements - the principle of the consumer providing the information once and making best use of information held publicly.

Panellist: Sebastian O’Kelly, Founder – Leasehold Knowledge Partnership

1. Surreptitious investment assets in the homes of ordinary families need to cease, whether ground rents (which are not for services) or abused management and permission fees.

2. Blocks of flats should be built with a residents’ management company, so that those with the greatest financial commitment to a site actually control it.

3. The sale of flats (and houses) as leasehold tenancies is unique to England and Wales and is fundamentally flawed. Commonhold exists on the statute book, needs some updating (currently under way with the Law Commission) and needs to be compulsorily enforced owing to the repeated abuses of the leasehold system.

Panellist: Simon Wilkinson, Board Director – Propertymark

1. Encourage lawyers to engage with the Government’s transformation reform agenda. 

2. Technology and training are key and estate agents need to move forward or move on.

3. Implementing processes now will help to increase profit.

FCI’s Planning and Premium Plus Planning Reports – Coming November 1st 

Two new FCI reports focused around planning will be available to order on tmconvey from November 1st. 

FCI Planning sample report: Click here to view

FCI Premium Plus Planning sample report: Click here to view 

FCI Planning will highlight planning and development activity in the local area surrounding the property for the preceding 10 years, including planning restrictions and major developments, which may impact the homebuyer’s enjoyment or future property value. The search radius varies dependent on the property location, with application and development data displayed in order of proximity from the property.

With FCI’s typical clarity, current and historical planning results are presented clearly by type for ease of review:

• Extensions and Small New Builds

• Developments

• Change of Use

• Lawful Development Certificate Applications

• Telecoms

• Planning Restrictions

Pricing: £24+ VAT

Users of FCI Premium will be familiar with its comprehensive residential assessments, covering Environmental, Flood, Ground Stability, Energy & Infrastructure, and Air Quality risks. And now things are set to get even more comprehensive, with the addition of the Planning component detailed above. The new aggregated report is badged as FCI Premium Plus Planning.

Pricing: £65 + VAT 

If you have any questions, please get in touch with your Account Manager or our friendly Helpdesk team on 0800 840 5571 or helpdesk@tmgroup.co.uk