Homebuying reforms with binding contracts to ‘save time and money’

The government says its planned reforms to the homebuying process, including binding contracts, will save time and money for both buyers and sellers.

The proposals are designed to speed up the long-drawn out and costly process of buying a home by four weeks, saving buyers an average of £710 and reducing unnecessary stress for all involved.

Sellers and estate agents will be required under the plans to provide buyers with vital information about a property upfront, including the condition of the home, leasehold costs, and chains of people waiting to move.

It’s hoped this will help end nasty surprises which result in last-minute collapses and give greater confidence to first-time buyers making one of life’s most important decisions. 

Binding contracts could also be introduced to stop people walking away from agreements after buyers painstakingly spend months in negotiations. This will help halve the number of failed transactions.

These are the main proposals:

• Sellers and estate agents must publish information from searches and surveys before a property listing is published. This will enable buyers to see the physical condition, characteristics, and flood risk of the property online. It will enable buyers to make informed decisions sooner and sellers will benefit from faster transactions, resulting in fewer costly fall-throughs.   

• The full list of proposed mandatory upfront information includes: tenure, council tax band, EPC rating, property type, legal and transactional information such as title information and seller ID verification, leasehold terms, building safety data, standard searches, property condition assessments tailored to property age and type, service charges, planning consents, flood risk data, chain status, and clear floor plans. 

• Buyers and sellers will have the option to sign binding contracts that would end the practice of parties pulling out of agreements months into the process, costing families heartbreak and hundreds of pounds.

• Deploying the use of digital tools – including digital property logbooks, digital ID verification, and standardised data sharing – enhancing transparency and security for buyers and sellers.  

• Introduce mandatory qualifications and ‘Code of Practice’ for estate, letting and managing agents, driving high standards in the sector and increasing trust in the industry.   

• The government will publish information on the services of estate agents and property lawyers, so consumers are well informed on how and where to get help. 

• The average time from instruction to completion is over 5 months, and the government estimates these reforms could speed up transactions by around four weeks.

Housing Secretary, Steve Reed said: “These proposals will speed up the sluggish housing market by halving the number of failed sales, costing the economy £1.5 billion a year, and the government estimates reforms could accelerate transactions by around four weeks.”

A full roadmap to introduce the new system will be set out in the new year.

Please contact us if you would like advice about the legal aspects of buying or selling a home.