Ensuring that a property is ready for sale is crucial to the successful completion of a transaction. This guide sets out top tips for streamlining real estate transactions, thereby minimising delays and scope for renegotiation of the agreed purchase price, as well as avoiding potentially abortive transactions and wasted costs.
1. Title Review
Instruct your solicitor to review the title and prepare a title pack before marketing the property for sale. This will ensure that all necessary title documents are readily available to provide to the buyer and its solicitor when Heads of Terms are agreed.
A review of the title pre-sale will allow your solicitor to identify any title defects or missing title deeds and assist in formulating a strategy for dealing with such issues from the outset. This tactic will avoid the delay of the buyer raising enquiries on such issues and price chipping.
Title registers often contain historic entries which are no longer relevant, for example, entries relating to expired or forfeited leases. Removing such entries may require the seller to submit supporting evidence or statutory declarations with its Land Registry applications, which will take time to collate and prepare.
Applications to the Land Registry should be made pre-sale to ensure that the title is updated, avoiding unnecessary enquiries by the buyer and delays in waiting for the Land Registry to process and complete applications.
2. Unregistered Land
Sellers should ensure that all deeds and documents of title are sent to their solicitor in advance of any sale, to allow sufficient time for review and preparation of an epitome of title. As with registered land, such a review allows any title issues to be identified and managed at the outset.
In both cases of registered and unregistered land, sellers should consider instructing their solicitor to prepare an overview title report, summarising any matters which require further investigation and recommending steps to take to prepare the title for sale. This will allow the seller to formulate its negotiating strategy with any potential buyer from a position of knowledge.
Review the title plan and check that it matches the boundaries on the ground. If selling part of a property, instruct a surveyor to prepare a Land Registry compliant plan. If dealing with unregistered land, plans to old title deeds can often be difficult to interpret. To avoid any delay in the buyer dealing with the unregistered plans and any surprises in the plans not matching the position on the ground, instruct a surveyor to produce an overlay plan. Any gaps in ownership can be identified and a solution formulated.
Is the sale with vacant possession or subject to leases and licences? Your solicitor can advise on the legal steps required to enable vacant possession to be given.
If the sale is to be subject to leases and licences, collate all documentation including management information. Prepare a schedule listing all leases and licences and extract key information for the schedule such as rent payable, rent review dates, term commencement and end dates, any break dates and service charge caps as well as details of any disputes with tenants. Such a schedule will provide a useful tool for managing enquiries.
5. Commercial Property Standard Enquiries (CPSE)
Replies to CPSE should be prepared in advance of a sale. CPSE should be answered fully and correctly, otherwise buyers will push back and raise further enquiries. Please click here to see the importance of giving accurate replies to CPSE. Preparing replies to CPSE in advance will also identify any issues which can be dealt with before they cause delay.
6. Planning history/building regulations
It is essential that the seller discloses all relevant planning permissions and provides evidence of satisfaction of planning conditions and any section 106 obligations. Ensure that all relevant documentation and building regulations completion certificates are obtained from the Local Authority, ready to make available to the buyer at the outset.
7. Third Party Consents
Are there any restrictions on the title requiring the consent of a third party before the sale can complete? An early approach will avoid delays in progressing the sale to exchange and completion. Correspond with any lender to ensure they will consent to the sale and release their security on completion.
Good planning in advance of a sale can minimise delays and mitigate hurdles to getting deals done. If you would be interested in attending a workshop session on preparing for sale, please contact Emma Townley to register your interest. The workshop will provide an overview of the documentation, information and processes required to ensure an efficient sale.
This article first appeared on Place North West Resources.