Owners face fines under new laws on selling homes

HOME OWNERS who sell their properties privately will be liable to fines and imprisonment if they fail to comply with new legislation aimed at speeding up the sales process.

HOME OWNERS who sell their properties privately will be liable to fines and imprisonment if they fail to comply with new legislation aimed at speeding up the sales process.

The criminal law, to be introduced next year, will carry a maximum £5,000 fine at a magistrates' court. The sanctions are part of a package of measures that is expected to bring about a radical change in the act of home buying, aiming to reduce the average time it takes to sell a property from three months to just two weeks.

Using new "information packs", sellers will be obliged to carry out a property survey and a draft contract at their own expense, adding around £500 to the cost of a sale. A spokesman for the Department of Environment, Transport and the Regions said that it decided to make breaches of the new law a criminal, rather than a civil, offence because it had been advised that it was the only way to stop a move towards unregulated private sales.

Estate agents will be responsible for ensuring that these conditions are met before the home is marketed for sale. Those agents who fail in their duty will be liable to the same criminal sanctions as vendors who sell their homes privately. However, they will be subject to prosecutions carried out by the Office of Fair Trading, which already has the power to fine estate agents or ban them from practice.

Buyers will also have to comply with strict rules including having to provide confirmation of a mortgage agreement before they can make an offer.

But, as expected, the Government has backed away from making gazumping illegal. Instead it hopes that by reducing the delay between offers and agreed sales there will be fewer opportunities for more attractive offers to be submitted by third-party buyers. Insurance companies are to be encouraged to develop insurance to protect buyers and sellers from gazumping. Other proposals aim to speed up local government property searches, while buyers will also have to provide evidence that there are no financial problems affecting their offer.

While most of the changes were welcomed "wholeheartedly" by the Law Society, which represents solicitors in England and Wales, it expressed reservations over the proposals for the new sellers' packs to contain compulsory surveys.

Buyers would be unwilling to trust a survey arranged by the vendor, the society warned, and they are likely to want to commission their own, creating additional expense and delay.

The Trade and Industry minister, Kim Howells, said the measures would bring "greater confidence" to, and speed up, the home buying process. "Too many transactions fall or are delayed at the last minute because this information is not available," he said.

Hugh Dunsmore-Hardy, chief executive of the National Association of Estate Agents, said that a compulsory regime was vital. "There have been many voluntary schemes, but none has worked," he said. But it was equally important that all parties involved in the selling of a property were subject to the rules, he added.