I read with interest the article on the back page of Money Marketing's April 3 edition entitled, Failure to offer seller's pack will not be criminal offence”.
I would like to provide my own comments to some of the points raised in the article. First, it was suggested that lenders would not accept the home condition report, creating the need for two surveys. I do not believe this will be the case.
Most lenders now use a panel of surveyors and all panels include bigger chartered surveyor companies Colleys, Countrywide, etc, so duplication should not be an issue.
Second, it was suggested that the initial cost of the seller's pack would put people off selling their property. In fact, I believe the opposite to be true. I feel there will be several advantages:
The up front cost of the seller's pack will eliminate time wasters testing the market.
The whole buying/selling process will be greatly speeded up, which should decrease the number of sales falling through.
When seller's packs become mandatory, it will result in a huge increase in vendors cutting out the estate agents by doing DIY housesales.
This last point is the most important and is the real reason that estate agents are most unhappy about the proposed seller's pack. Each year, a growing number of people are using companies such as mine to cut out the estate agent and sell their own homes. What they save in estate agent commission is far greater than the cost of a seller's pack.
At the risk of being dramatic, I believe that the ever-increasing use and popularity of the internet, coupled with the introduction of the seller's pack, will decimate the number of estate agents in the high street over the next few years.
The many excellent property portal sites in existence (such as Fish4Homes) and availability for the public to register their own property on DIY websites (such as 1st4Property.com) will result in the closure of many traditional high-street estate agents.
This is a serious threat to estate agents and a real new business opportunity for IFAs/mortgage brokers. For example, 1st4Property is about to launch a major advertising and recruitment campaign this summer aimed at IFAs and mortgage brokers.
We intend to recruit several hundred agents over the next 18 months to ensure that we are ideally placed to capitalise on the tremendous business opportunity that the introduction of the seller's pack poses to us. Many financial advisers suffering a reduction in commission income due to factors such as:
The demise of endowments.
Stakeholder pensions and 1 per cent charges.
The abysmal equity results and lack of consumer confidence
More and more advisers are becoming reliant on mortgage business to make ends meet. In more ways than one, by adopting our business approach, property could well be the new pensions, for financial advisers and clients alike.