CONVEYANCING Post HIP changes inconveyancing
Stuart Pearce sheds some light on the state of the property search process.
T
he HIP regulations, suspended on 20 May 2010, are expected be formally repealed in October. Aside from relieving a headache
for agents, one major effect of the change was putting the brakes on the rise of the ‘personal’ Local Authority search. During the conveyancing process,
lawyers require search information from Local Authorities. They obtain a fully compiled and guaranteed search by sending a request electronically or by post to the local authority. Personal search companies offer lawyers
an alternative. They obtain the raw data from the local authority by visiting them in person to compile their own version of the ‘official’ search. They found favour within HIPs as they could be packaged and priced on a national basis. The rules allow Local Authorities to charge different prices for official searches, meaning the cost would vary; in almost all cases were higher than personal search prices.
PERSONAL vs OFFICIAL The rise of the personal search began to gather steam in the long period of deliberation before HIPs were introduced, but they always remained in the minority. Different bodies have argued over their merits, but the key difference remained the unlimited liability offered by an official search. Given the importance of a housing transaction, conveyancers will always prefer this level of cover, except in unusual circumstances. Recent research by MDA SearchFlow found that since the end of HIPs, 70 per cent of conveyancers now use official searches exclusively. Post HIPs, the search industry focused on an ongoing dispute regarding the Environmental Information Regulations (EIRs). These regulations, a consequence of a European Directive, mean that publicly held information related to the environment must be made available for free. Most personal search companies believe that this entitles them to free, full
Publicly held environmental
information must be made available free of charge.’
access to search information and the Information Commissioner endorsed this view. As a consequence, the Government suspended the statutory access fee of £22 for access to the land charges register, a small but crucial part of the search. On the surface, the removal of this fee
makes a personal search cheaper, so more attractive. However, savvy Local Authorities are adjusting their prices for the remaining parts of the search, covered by form CON29, to remain competitive and in line with the law which dictates that they should recover their costs. In addition, many Local Authorities will
take time to process requests to process information for free, and have 20 days to respond. A turnaround time of 20 days will not satisfy conveyancers used to the 2-3 days it takes to receive an official search. A further consequence of the EIRs could
be that Local Authorities are asked to make all the information covered by form CON29 free. There’s a fascinating legal battle raging on this issue, and it’s not clear how it will be resolved. There’s a big difference between information being make available to personal search agents, and having unfettered access to the data.
REALITY CHECK The realities of the conveyancing process mean that personal searchers will need full, on demand access to data that is updated in real time. Would Local Authorities be instructed to provide real-time, secure data available to download? If so how could this be achieved, given the variation in IT processes across local Government? Otherwise, Local Authorities could be asked to provide a report within a certain time frame. Would this be quick enough to meet conveyancers’ demands? The finer points of how this situation unfolds will determine whether the EIRs offer hope for the personal search market, or a dead end. Against this backdrop, it’s comforting to
know that CON29 reports within official searches, backed by unlimited liability, remain the single, authoritative source of Local Authority property data. The reliability of official searches is wholly unaffected by these developing issues. With the implications of the
Government Spending Review beginning to unfold, it’s clear that the next chapter in property information will depend on how Local Authorities maintain their service with constrained budgets. The story will be one of finding ways to store, update and retrieve data as cost effectively and efficiently as possible. That’s where the real savings lie for end consumers, which we can all benefit from.
Stuart Pearce, Managing Director MDA Information Products
Add your own tips and techniques online at:
www.propertydrum.com/articles/posthips
PROPERTYdrum OCTOBER 2010 25
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68