Thursday, April 27, 2006

An Easier Way to Buy Empty Homes

If you owned an empty home and you had no imminent plans to fix it up and rent it out you might very well be tempted to sell it. After all, the empty home is bringing in no income and in all likelihood is costing money. In most parts of the UK the property market is pretty flat at the moment meaning no increase in capital value either. The logic is obvious, but the reality different. Most property owners who see the logic have already sold, those that are left have other motivations or perhaps no motivation at all.

Introducing an extra obstacle and expense to selling property might not be the best way to encourage unmotivated owners to sell their property. But next year the government is introducing home information packs (sometimes called seller’s packs) as this rather good new website explains

The Home Information Pack is a set of documents providing important information about a property such as searches, copies of the deeds and a new document called the Home Condition Report, which assess the condition of a property and its energy efficiency. From 1 June 2007, all home owners in England and Wales will need to prepare a Home Information Pack before putting their home up for sale”. (They’re planned for January 2007 in Scotland)
The seller will also need to pay for it and the government thinks that costs “will be of the order of £600-£700”

The government point out that these cost are not additional and may not have to be paid until the property is sold. All true, but they're costs that are currently borne by the buyer so they are new costs for the seller. This could be a problem, nothong puts the reluctant seller off like a fat bill. But the market is quick to spot an opportunity and nobody is quicker at the moment than the supermarkets. Asda has got in there first and is piloting a low cost estate agency with free home information packs. Free home information packs really are a good incentive, if this idea catches on it far from being a disincentive it may even encourage more unmotivated owners onto the market.

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