David Gilman is the partner in charge of Blacks Connect
Any chain is only as strong as its weakest link and this is particularly apt in the case of property purchases. It only takes one link to break and the impact is felt by the whole chain of buyers and sellers – and their brokers and conveyancers.
Even if the chain holds together, one delay affects everyone involved. It can be time consuming, costly and frustrating when you are trying to get a deal through against hold ups you have no control over.
The long and the short of it
The longer the chain the more vulnerable it is to delays and to collapse and they have certainly got longer in 2012.
When you have five or six people in a property chain, there is much greater potential for something to go wrong, compared to a short, sweet chain of three; the first-time buyer, the upsizer and the seller.
But why have chains become noticeably longer and therefore more prone to delays, this year?
In fact they are returning to trend because they have actually been unusually short in the last couple of years.
In the post-credit crunch environment, many vendors were so petrified of losing a buyer that they were willing to sell up before they bought another home, and either move in with family or rent somewhere in the meantime.
At the same time a rash of accidental landlords who wanted to buy but wouldn’t sell at a discount, decided to let their existing property to buy another. This breaking up of long chains into smaller ones meant they went through much more quickly and with fewer collapses – quite simply there was less potential for things to go wrong.
In 2012 there has been a definite shift back to longer chains, and with that all the frustrations that buyers, sellers, brokers and conveyancers feel when something goes wrong.
The fear factor seems to have gone from vendors, so they are less willing to move into rented accommodation just to make a sale happen. In addition, there are far fewer available rental units to move into, so it’s not such an easy or cheap option.
The accidental landlord phenomenon also seems to be running its course, as vendors now realise their property’s value may actually fall further if they wait to sell.
We understand that delays are frustrating for everyone involved, and especially for brokers. And we know that the finger is often pointed at conveyancers, but we are as keen to get the deals through as you and your clients. Remember we get paid on completion too.
As a broker you need to make sure you deal with a specialist conveyancer rather than a firm that dabbles in a couple of cases a month. The best ones have strong systems and processes set up to minimise delays and keep the ball moving. For example we are proactive in ensuring everything is ready at our end in advance of being required and we work hard to hold chains together.
Plus if your client’s first purchase does fall through, for whatever reason, our Blacks Search Promise guarantees to cover their search fees next time around, so you will keep their business.