The UK government has now issued guidance to those buying or selling their home during the Covid-19 lockdown. This update clarifies what you can do now – whether you are considering buying or selling, already have an offer accepted or have already exchanged contracts and are waiting to complete your transaction.
The key message, that we are all now familiar with, is that we should, where possible, delay moving house while stay-at-home measures are in place. However, that does not mean that transactions cannot progress provided parties show good will, common sense and are prepared to be flexible. We are here to help you achieve that.
If you have not yet exchanged contracts (you might still be waiting for search results, replies to enquiries from the other side or your mortgage offer – all of which are taking longer than normal), you can still progress the transaction.
The parties should work together to amicably agree a future date to move (either far enough ahead that stay-at-home measures are likely to no longer be in place or following the service of a notice once restrictions have been lifted and everyone can move again). If you are buying with a mortgage, the lender will need to be on-board with any extended or variable period between exchange and completion.
If you have already exchanged contracts and are waiting to complete your transaction, whether or not you need to delay completion will turn on whether the property is vacant.
Vacant property: our starting point is that the transaction can continue as planned – provided this is done safely for all involved, ensuring that removal staff and any associated parties follow the latest guidance regarding self-isolation and social distancing. However, if there is a chain, this may not be possible.
Occupied property: it is imperative that you talk to your solicitor now to try and delay completion.
The parties can agree to vary the contract (by way of a second agreement between them) to delay the agreed completion date until everyone can move. Your lender will need to be involved in these discussions too to ensure that funds will be available at the new completion date.
This is critical for a buyer, as failure to complete could result in them paying compensation to the seller and – if the contract is terminated following the service of a notice to complete – forfeiting the 10% deposit. Other damages may also be payable.
There is no guarantee that a seller will be willing to defer completion (particularly where they are the top of the chain) and a buyer can best protect themselves by completing as soon as possible, but only if it is safe to do so.
If your home is not yet on the market but you are thinking seriously about moving, now is the ideal time to contact estate agents and prepare your property for sale. You can do this by:
- gathering all documentation and information about the property (including copies of planning permissions, building regulations completion certificates, certificates for electrical work etc.);
- asking us to provide you with proforma enquiries to begin completing (this will flush out matters in respect of which you will need to provide documentation);
- instructing us to deal with any defects in the property’s title (for example if there are unregistered areas or the absence of an express right of way) which are better resolved prior to going to market; and
- discussing practical issues and solutions with your estate agent, such as the possibility of virtual home tours
We are all living in an uncertain world and our fundamental advice to all parties is to be sensible, flexible and realistic when buying and selling property. We are ready to help you do this.