Friday, 10 August 2012

A game of patience anyone?

With both the negotiating and conveyancing stages of residential transactions increasing exponentially, the tendency is for agents and their clients to become frustrated as a potential agreed sale, let alone exchange of contracts, appear to be well beyond the horizon.

With the right approach however, sales are being agreed, exchanging and completing but the entire process requires a greater degree of patience.

For the majority of properties, certainly in the Bath area, the days of quick-fire negotiating and rapid agreements on price are a thing of the past. This is currently due to both buyers and sellers rather than one party or the other.

The best opportunities for sellers to achieve the best price is within the first four weeks of marketing, but even if you inform your client of this from the outset they are usually opposed to agreeing a sale, taking the view that they may get a better offer if they are patient.

Buyers are taking a similar standpoint but naturally for opposing reasons. They are taking the view that there are fewer quality buyers in the market (and they are correct) and that they are more likely to get the property on their terms if they leave an offer on the table for the owners to consider over a longer period of time rather than hastily over-pay. 

In times gone by agents would be forgiven for thinking that a sale wouldn’t materialise out of these circumstances, usually because the buyer loses interest or finds something more suitable. That trend has changed though. Maintaining contact with your client, providing regular market feedback, as well as consistent and frequent updates to your buyer can be rewarding for all parties concerned. Over the course of the last six months properties from terraced town-houses to small country cottages and even larger country houses with land have benefited from this patient if somewhat protracted approach with negotiations ranging from one month to four months but significantly ending with happy sellers and purchasers alike. 

Unfortunately for everyone involved further reserves of patience are required to see us through the seemingly never ending conveyancing process. Between scrupulous solicitors, anxious surveyors and inefficient lenders, the timescale between exchange and completion is becoming cavernous, regardless of how often you are talking to all parties concerned.

Of the last eight properties to be sold by the Bath office this financial year only two have managed to exchange contracts within three months and nine of the properties under offer have already exceeded at least two months.

It is a trend that I believe will last as long as the market remains depressed. Buyers and their solicitors will remain nervous. Most surveys lead to a number of specialist reports with damp, timber, electrics and wiring being the most common. With lending criteria so stringent and the sheer amount of time that it is taking to process applications and book valuations those purchases requiring a loan will no doubt continue to take considerably longer than those that do not. 

It is imperative that sellers remain calm and patient, as we agents must do too and we must manage are clients expectations from the outset and throughout the process as a whole. Neither buyers nor their advisors will be rushed, and trying to force the process will only have a negative impact. Just recently the owners of a building plot became exasperated with their purchaser and the length of time everything was taking. Against our advice they enforced a deadline upon their buyers and the buyers promptly walked away and our clients are now back at square one, in fact it is now far more likely that the plot will sell for a lower figure next time round. The important thing to remember is that it is better for everyone concerned if a sale proceeds to completion and not when.

Patrick Brady

Residential, Bath

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