Home sellers can still make progress under lockdown
Chris Salmon is a co-founder and director of Quittance Legal Services
The first piece of advice we’ve always given to sellers is “Don’t wait to instruct a solicitor until after you find a buyer”. Under the coronavirus lockdown, this advice is truer now than ever.
The property market will be frozen for weeks to come. Once the strictest form of the lockdown ends, there may be restrictions that remain in place that make arranging valuations and viewings more challenging.
Even if a quick sale is needed, without a buyer it will be tempting for sellers to give up on progressing the move until the lockdown ends. However, much of the sale conveyancing process can be carried out before a buyer is found.
Here’s what a solicitor can (and probably should) do to progress a house sale during the market hiatus.
Client ‘Identification and Verification’ (ID&V)
Anti-Money Laundering (AML) requirements have not been relaxed during the lockdown. Firms are expected to comply with their Client Due Diligence (CDD) obligations as usual.
For most transactions, the combination of electronic ID verification and a certified copy of the seller’s passport (or sight of the original) will still be sufficient. However, obtaining a certified copy will not be possible under lockdown and many clients will be reluctant to send their passports to a solicitor’s homeworking address, much less visit a post office.
Firms could consider asking the client to email a copy of their ID. The client could then schedule a video call and hold up a picture of their ID next to their face for verification during the call. Used in conjunction with an electronic ID check, this may even be more robust than the firm’s standard ID&V procedure.
Firms may choose to skin the cat in other ways, but for most transactions, the AML requirements should not be an excuse for delay.
Source and collate documents
Work cannot commence on a sale transaction until the vendor has completed the necessary transaction forms.
Sellers may assume that nothing can and will be done on their files until the lockdown period ends, and agents should not rely on conveyancers to be proactive. It would be worth telling clients that the conveyancing process can still progress and they should complete and return these forms without delay.
Sellers can also use the hiatus to source missing documents, guarantees and certificates.
If the property is leasehold then the solicitor will need to source a managing agent information pack.
When the lockdown ends, there will be a surge in demand for management information that can only increase the average time required to obtain it. In combination with conveyancers escalating workload, conveyancing transactions will inevitably protract.
Assuming that the seller’s freeholder or managing agent is operating, there is a window of opportunity now to get the management information on file before the floodgates open.
What happens when the market restarts?
Although property insiders predict a period of uncertainty in terms of property prices and volumes, there will almost certainly be a rush of interest and activity as the lockdown ends.
While COVID anxieties could flatten the market, the financial impact of the virus will inevitably prompt some homeowners to downsize. Many people changing jobs will also still need to move house. Interest rates are also historically low, enabling more first-time buyers to get that on that first rung.
Conveyancing firms, search companies and mortgage brokers may have downsized or put staff on furlough, and some will be unable to immediately scale up to handle a sudden rush.
If a seller has instructed their solicitor weeks earlier, not only will much of the paperwork already be complete, the established relationship between a vendor and their lawyer should help them get to the front of the queue when a quick response is needed.
Sellers who have already completed some of the more time-consuming steps (like sourcing leasehold information) will have potentially shaved weeks off the conveyancing process. This time-saving could make the difference to buyers who are in a rush to move.
No move, no fee, no brainer
No move, no fee deals mean there is very little reason for sellers to hold off instructing a solicitor until a buyer is found. For many of the reasons set out above, buyers should also consider instructing a solicitor during lockdown, even if they haven’t found a property to buy.
Whatever a seller’s circumstances, instructing a solicitor now is a sure way to impose some control and certainty over what are (and will continue to be) uncertain times. Being more prepared when the lockdown ends and the market restarts will reduce the inevitable stress of the home moving process, and will help to ensure a faster, easier move.
Quittance Legal Services is a national conveyancing solicitor panel.