A Guide to Selling. Choosing an Estate Agent

Transcription

1 A Guide to Selling This article deals with issues relating to selling your house including the particular legalities unique to Northern Ireland. As a property seller you probably have some knowledge of the process from when you bought. If you need refreshing our articles will take you through the entire complicated business and remind you what estate agents, solicitors, lenders, surveyors and financial advisors actually do. Preparing Your Home Your home should be clean and uncluttered Your furniture should be arranged to use the space to best effect Lights should be on, even during the day, to give a bright impression Consider pot pourri or aroma pouches for fresh smells Keep pets and children out of sight and sound Gardens should be trim and tidy Light the way to the front door and make sure it is neat Make sure your street number is clearly displayed near the front door Allow the potential buyers time by themselves to chat privately (don't crowd out or hassle) Don't follow visitors into rooms as that may make rooms appear smaller Turn off televisions and radios Replace dead light bulbs Fix door handles, windows, latches and creaking doors and floors Keep bathroom and kitchen clean and smelling fresh Ensure the windows are clean Point out security features such as special locks and lights End the tour in the best room so everyone leaves with a good impression Remember to:- Let your estate agent know where you are at all times Make sure the sales brochure is accurate Make sure the estate agent is aware of all the best features Be accommodating when arranging viewing times Choosing an Estate Agent What Do They Do? In Northern Ireland the estate agent acts for the seller of property and provides information to prospective purchasers. The seller pays his agent. The estate agent will:- Value a property for sale purposes Discuss and agree an asking price with the seller Provide information for buyers Arrange appointments for viewing Negotiate the price Arrange mortgages for purchasers Pg 1

2 What Do They Do? (contined) Check out purchasers Have they really sold their own property? Are they really capable of raising the money? The job of an estate agent is to put the right price on your property and then find the right buyer. If an agent puts too low an asking price, it may sell quicker, but you could lose quite a bit of money. If too high a price is asked for your property may not sell at all or may not sell in time for you to buy the home you want. How Do I Pick One? Before settling on one agency ask several to value your home If you don't feel confident or comfortable with an agent in the first ten minutes don't pick him or her (buyers won't trust them either) Ask whether advertising, internet marketing, photographs or board erection expenses are included in their percentage charge or charged as an extra Discuss fees with agents; the "going rate" in Northern Ireland is 1.5% of the sale price although this can sometimes be reduced by negotiation Remember VAT at 17.5% is added on to both fees and extras Ask friends, neighbours and relatives about agents in your locality No agent needs to have any qualifications but RICS, ISVA & NAEA all have codes of conduct and some agents are governed by the ombudsman scheme Estate agents are governed by legislation which makes it a criminal offence for an agent to misrepresent information In Northern Ireland almost all properties are sold on a sole agency basis which means the agent will earn the fee commission if the property is sold by any means (even without the agent involvement) whilst on the agent's books A joint agency is where two agents work together and agree to share the fee; this tends to occur where it has taken some time to sell a property and another agent is brought in Valuing your Property What Is Your Property Worth? Estate agents value property using several criteria:- Location, location, and location are still the three most important considerations in property valuation! Selling prices of similar houses recently bought in the area Condition of the property Number of houses on market Number of buyers looking to buy Availability and cost of mortgages (affected by interest rates) Urgency of sale Picking a Buyer There are certain types of interested parties who will have certain characteristics. Sellers are often vulnerable to buyers trying at the last minute to renegotiate the price downwards (gazundering), when the legals are just ready to sign, by buyers using the excuse of a bad survey or financial difficulties. Is the potential buyer a wise guy? Sellers should ask a few relevant questions to find out who are the real potential buyers and what Pg 2

3 are their personality traits: Questions to ask Do you have a property to sell? Where is it? How much of a mortgage can you afford? Where else have you been looking? When do you want to move? How long have you been looking? You will normally be able to put your potential buyers in one of the following categories:- Time Wasters Nosey neighbours interested in getting valuation or decoration ideas for their own property. Financially impoverished show offs on a day out. Ditherers who may never decide on anything or worse will lead you up the garden path and change their mind at the last minute. Bored people who enjoy others making a fuss of them. First Time Buyers Have a specific limited budget. Can only spend what they can borrow. Can arrange mortgages but don't know how to. Will rely on advisors. Are flexible on completion dates but have no sense of urgency on progressing their mortgage or legals which can cause you delay uncertainty and stress later. Cash Buyers Are a rare breed. May not be cash buyers at all "oh the building society is providing the cash!". As they are using their own cash funds may be tight. May not take survey or mortgage process seriously until late on causing you delay, the uncertainty and stress late on. Flexible on completion dates. Can complete quickly if necessary. House Already Sold Buyers (in rented situation) Will need mortgage to add to funds from their sold property. Will know exactly what they can afford and will have limited financial flexibility. Flexible completion dates at a time suits seller. Can complete quickly if necessary. House To Sell Buyers Not really buyers at all because, unless financially well off, despite what they say they won't sign up until their own property is not only agreed for sale but also signed for (a long way off!) Timing unknown. Will probably not yet have made any mortgage enquiries Don't tell them you'll keep the property or hold the price for them even if they are nice! Ask your agent about whether their house will sell quickly. Pg 3

4 Make sure your agent investigates the potential buyer s financial and own property situation. Can they raise the mortgage they claim to be able to? Beware of recently self employed buyers who will have difficult verifying their income for mortgage purposes. Is their property really agreed for sale? Choosing a Solicitor Solicitors are practising lawyers and officers of the courts who have had a legal education and, who have passed examinations. Under the Solicitors Northern Ireland Order 1976 solicitors in Northern Ireland have a monopoly on the legal process involved in the transfer of land (conveyancing). Solicitors are regulated by this statute and the Law Society of Northern Ireland in relation to the fees they are allowed to charge and how they may advertise their services. They are also subject to spot checks by the Law Society on their management of client monies and have to undergo an annual independent audit of their accounts and disclosure is made to the Law Society of any accounting irregularities. Solicitors have to annually pay a contribution to a compensation fund which is used when solicitors commit fraud or become bankrupt. This fund has made sure no client in Northern Ireland has ever lost money as a result of a solicitor s fraud or insolvency. Some solicitors have achieved and maintain Lexcel practice management standards audited on behalf of the Law Society of Northern Ireland. Conveyancing In Northern Ireland estate agents find the buyer and agree price details; solicitors do the paperwork. Contracts for the sale and purchase of land must be in writing. For this reason and because the process involves so much money solicitors act for sellers and buyers to advise and protect their respective interests. This process is called conveyancing. Conveyancing procedures involve the preparation of a contract by the seller s solicitor and the examination of the contract and the title (ownership) documents by the buyer s solicitor prior to signature. The seller is obligated to disclose all his knowledge about the property but the buyer carries responsibility for buying the property in its current physical condition. The process is complicated and will take longer than you think. Which Firm To Use? Conveyancing is complex legal work. In Northern Ireland fees charged for the conveyancing of residential property are subject to a competitive marketplace. Some tips are: Solicitor s conveyancing fees vary considerably between firms and there are lots of firms. Some firms adhere closely to traditional fee scale rates (1% of the price + an hourly charge for time) and refuse to quote for business. Others are keen to give competitive quotations. Some firms give competitive verbal fee quotations over the phone. Do not instruct a firm on the basis of a verbal quotation over the phone. Only consider instructing a firm which has provided you with a detailed written quotation. Pg 4

5 Solicitors are obligated by Law Society of Northern Ireland regulations to provide you with written terms of business detailing pricing arrangements in a specific detailed form. Check the written quotation details not only the firms proposed fees but also all the tax, registration, search and other expenses involved. The additional expenses will be the same for all firms although some firms identify these costs more clearly Very often the presentation of the quotation information is a good guide to how organised and efficient the firm is. Most of your business will be transacted by letter, over the phone or so a local firm is not essential. All your business can be effected over the phone, or post if you want. Does the firm: Advertise it clearly wants this type of work? Do the staff have pleasant and friendly telephone manners? Have you been given good detailed written quotation information? If a firm passes the above tests don't quibble if the professional fees are a few pounds (rather than hundreds of pounds more) Lenders A solicitor is responsible not only to his seller client but also to the seller s lender who must be paid off the entirety of the existing loan. Similarly a solicitor for a buyer is also legally responsible to the lender providing the new mortgage money and has to report to that lender on behalf of and at the expense of the buyer. Home Charter and Lexcel Schemes The Law Society of Northern Ireland have a compulsory kite mark quality scheme to set standards of quality of work by solicitors in Conveyancing matters (the Home Charter scheme). Some firms also comply with the higher Lexcel quality management standards. Whilst the Home Charterscheme does not measure how quickly or efficiently solicitors do their work it does set minimum standards and tasks which are expected to be adhered to by all Solicitors in all residential conveyancing matters. Some firms provide better standards and speed of service at more competitive rates than others. The Home Charterscheme provides a benchmark against which complaints can be measured. Seller's Solicitors Job A quick checklist of tasks for the seller's solicitor in Northern Ireland are: Examination of ownership documents. Preparing and sending a sale contract with the ownership documents on loan to the buyer's solicitor. Helping the seller complete detailed disclosure questionnaires. Applying for property certificates from the Department of the Environment and local council. Applying for Bankruptcy and Court Judgement searches against the seller. Applying to the Land Registers for searches against the seller to make sure all outstanding mortgages or registered debts are taken into account. Having the seller complete and settle detailed lists of fixtures, fittings and contents included or excluded from the deal. Ensuring the seller has an Energy Performance Certificate for the property Pg 5

6 Obtaining exact financial details of debts owned to the lender, estate agent, ground landlord and others in preparation for discharge on completion. Considering any amendments to the contract after the buyer has signed once the contract has been received back from the buyer's solicitor and settling any problems which have arisen. Having the contract countersigned by the seller and put into legal effect by faxing a copy of the contract to the buyer's solicitor. Having the seller sign transfer documents in preparation for completion. On completion day paying off all mortgages and charges against the property and applying for release documentation. Informing the Rates Office of the buyer's name and forwarding any refund to the seller. Accounting to the seller for the net proceeds of the sale after debts and expenses are paid off. Completing the registration of release documentation to free the property from previous debts. Closing the solicitor's file and storing it for twelve years in case of future disputes. What can we do for you? Wilson Nesbitt Solicitors aim to keep things transparent and as simple as possible for our clients. We don't want you to worry at any point about the legal complexities or technicalities of your transaction. You'll be kept informed throughout the process. We offer price transparency and deliver by whatever combination of telephone, , post or direct consultations suits you best. We can conduct transactions entirely electronically or by post if you wish. Our property team members are experts in managing the process of buying and selling property smoothly and seamlessly. To make immediate use of our services simply complete your details and we'll give you our free, instant, no obligation legal expense quotation. Once you have instructed us, you will be able to follow the progress of your transaction through our Online Case Tracking System. Should you wish to obtain further information on our services then please either contact one of our experienced team members profiled on the right of this web page, telephone property@wilson-nesbitt.com. Pg 6