Earlier this month, the government opened a consultation on home buying and selling reform.
This includes proposals that sellers and estate agents must publish information from searches and surveys before a property listing is published, binding contracts between buyers and sellers, using digital tools to enhance transparency and security, and introducing qualifications and a Code of Practice for estate, letting and managing agents.
IMLA executive director Kate Davies said: “Buying or selling a home is the most significant financial transaction most people will ever make — yet the system that underpins it has barely evolved in decades.
“Far too many sales collapse unnecessarily, creating frustration for consumers and inefficiency for the industry. Every failed transaction is wasted time, money and emotional energy for borrowers, sellers and the many professionals involved.
“Lenders welcome any reform that helps reduce these failures, introduces greater clarity and harnesses technology to deliver a smoother experience. The current process is ripe for change.”
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She pointed to the fact that one in three transactions currently falls through, costing consumers and the economy hundreds of millions of pounds each year.
“Every sale that collapses after mortgage approval represents an avoidable loss for buyers, for sellers and for lenders who have already completed affordability assessments and underwriting. Reducing those failures will deliver real savings and greater confidence,” Davies added.
She also praised the government’s pledge to improve the flow of information by providing upfront information and standardising documentation as the system would be “fairer, more transparent and less nerve-wracking for everyone involved”.
Davies said that lenders have “invested heavily” in digitising their own processes, enabling faster approvals and smoother broker and customer journeys, but progress can only be fully realised when the entire property chain modernises together.
“Digital logbooks, verified data and interoperable systems are key, but there is still work to do to make these tools consistent and secure across the market. Industry and government must collaborate to create uniform standards that all parties can trust,” she added.
Davies strongly welcomed the proposal to introduce mandatory qualifications for estate agents and a new Code of Practice for property professionals.
“Mortgage lenders and advisers operate in one of the most highly regulated sectors of the economy, and advisers must achieve rigorous qualifications before advising consumers. It is extraordinary that such standards have not yet been applied to estate agents, given the importance of their role in the property chain. Professionalising the estate agency sector will help rebuild public trust and create a smoother, more accountable home buying process,” she said.
Reform would also re-energise market activity and consumer confidence, as the process is “clunky and unpredictable, it can be genuinely demoralising for many would-be buyers”.
“We need more movement at every level of the ladder, enabling people to enter the market, move up as their families grow and downsize when the time is right. A modern, reliable process would help unlock that natural mobility.”
“The government’s consultation is a chance to bring the property transaction process into the 21st century. Lenders stand ready to play their part in delivering a system that is faster, clearer, more consistent and more professional, for the benefit of consumers and the wider economy,” Davies said.
