When buying a property, one should have the flexibility to appoint their own solicitor, and they do. However, when investing in off-plan or new build properties, this is sadly not always the case. Very often, developers and sales agents pressure clients into using their recommended solicitor. Sometimes, they even offer a cash incentive.
The purpose of this article is to highlight why they do that, and why it might be a good idea to take independent advice from a solicitor that is not directly connected to the developer. Believe me; I have had my fair share of headaches.
Also, we will cover key attributes any solicitor you appoint should have if you are considering buying an off-plan or a new-build property.
Why do sales agents and developers push you to use their solicitor?
It is important to understand that the sale of a property for a developer is entirely commercial. They need deals done fast and efficiently as the more properties they sell, the easier it is for them to secure funding and plan ahead. Therefore, they want the contracts exchanged quickly, usually within 28 days.
Currently, the average property price in the U.K. is £231,855, and it is often one of the most significant financial transactions you will ever make. Do you want to be pressured into using a firm that could potentially have vested interests? Probably not.
Ok, what’s the issue?
The issue is that if you are using a solicitor that the developer has recommended, the chances are they are appointed regularly and may process 100’s if not 1000’s of sales on the developer’s behalf.
Think about it, where do you think their true loyalty lies, with the company that is giving them hundreds of thousands of pounds each year, or with the individual that uses them once?
Also, the solicitor’s job is, but not limited to checking and carrying out the following:
- Planning permissions (ensuring that the property has been constructed in full accordance with them)
- Make sure roads are adopted correctly, and utilities and drains are appropriately established
- Conducting Searches
- Reviewing the overall title
- Making sure all plans are correct
- Highlighting restrictive covenants if there are any
- Ensuring services infrastructure is in place
If there is only one firm responsible for the above, then something could be missed, resulting in issues for the buyer. The conveyancing with property is a complicated process, and there are a lot of potential pitfalls. Some of these could be:
- A failure to arrange an NHBC inspection
- Agreements for roads and sewers that are incomplete
- A failure to plan for future maintenance of the common parts of a project
The above are only some of the problems that can arise. A good, reputable solicitor will always ensure that your deposit is protected and the contract is fair. Also, It is crucial that the contract contains a long-stop date.
Sadly, not all solicitors are created equally, and some are more experienced in off-plan/new-build conveyancing than others. The more knowledgeable are more likely to spot issues that another, less skilled solicitor may miss. Plus, an independently chosen solicitor is not as likely to buckle under pressure from a developer.
If you are considering investing in an off-plan or new-build property, you must research and appoint a solicitor that will act in your best interests. You can do this by checking reviews online. It is also entirely reasonable to ask to speak to clients that they have previously represented, and if they are not willing to let you do that, find alternative representation.
As a client, you want one that has the experience to complete the transaction properly and do so in a timely manner.
Don’t let anyone tell you that you don’t have the right to choose your own solicitor. The Law Society, SRA (Solicitor’s Regulation Authority) and the CLC (Council for Licensed Conveyancers) strictly state it’s members should ensure that a client has not been pressured or incentivised to choose them to act.
If you do find yourself in that situation, you will be amazed at how the salesperson lays of the pressure when you mention the SRA or CLC.
One final point, don’t choose a solicitor because they are cheap. You really do get what you pay for, like my Grandmother always told me, “You buy cheap, you buy twice”.
At The Property I.C. we have experienced a lot of issues dealing with developer recommended solicitors. That is why we now only appoint our own independently vetted ones.
If you have had a bad experience with a solicitor, need any advice, or find some of the terminologies in this article confusing Contact us here.
Article by: Rory van den Berg