The HSBG, which was formed to create standard wording for a reservation agreement, released more details of how it sees the agreements working.
It recommended the agreement be dependent on the information available during the acceptance of an offer as well as the buyer and seller’s circumstances.
Both parties will be expected to pay a commitment deposit which they may lose if they breach the agreement and the deposit will be protected by an arbitration process.
The HSBG acknowledged there were still questions to be cleared, such as whether RAs should be voluntary or made compulsory and if the agreements would prevent sellers from putting properties on to the market or create complexities.
And while consumers and the industry appear “split” on the potential success of RAs, the HBSG noted that those already using them believe they improve the process and save consumers time and money.
The Ministry of Housing, Communities and Local Government said it would conduct a reservation agreements trial in the first quarter of 2020 depending on the results of its consumer research.
Joe Arnold (pictured), managing director of Arnold & Baldwin Chartered Surveyors and member of the group, said: “Work is continuing to ensure the right approach is eventually implemented.
“One thing for sure is that, if Reservation Agreements are successful and aborted property sales are reduced and transactions times sped up, this would substantially improve the home buying and selling process for everyone involved.”