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To avoid delay, expense and uncertainty, it is far better to spell
out what exactly can be taken and what cannot. With the increase in Stamp Duty,
especially at the stepped rates, it is now common for the asking price to exclude
“fixtures and fittings” to avoid falling into the higher duty band.
A separate contract and price is then concluded for these excluded items, additional
to the purchase price of the property. Just be certain, at the very beginning,
as to what is, and what is not, included.
When all is agreed in principle,
the seller‘s solicitor will prepare a draft contract to send to the purchaser‘s
solicitor for approval or suggested amendments. This is because only the seller
knows what title he can give; whether freehold or leasehold and including any
documents or events, such as the death of the original owner and probate of the
will vesting ownership in the seller plus any encumbrances (easements) against
the title, such as rights of way. The best evidence of title is, of course, the
title deeds or lease and these may be handed to your conveyancer or, if the property
is mortgaged, obtained from the lending source. The last statement from your
mortgage provider will be a great help. If the title is registered, your conveyancer
will need to know the title number so s/he can obtain all the necessary information
from the Land Registry.
At this stage, when the sale or purchase is still
going through the initial preparatory procedure, either side may withdraw without
liability and can do so right up until contracts are exchanged. Often, with rising
prices and the inherent delay built in to the system, “gazumping” may
occur. This happens when the seller accepts a higher offer than the one already
agreed. Note that the seller has previously agreed a sale verbally and then reneges
on that agreement enticed by the higher amount. The word “gazump” derives
from the Yiddish word “to cheat”. It does not mean that the seller is
unable to cast around for the best bid; it only occurs when he has already agreed
to sell at a definite price, but “subject to contract”. There is little
that can be effectively done to stop the practice, as the seller is legally entitled
to proceed with the best offer. The purchaser can, when the offer is accepted,
ask the seller to agree, in writing, to treat with him alone for a specific period,
to allow the purchaser to conclude his enquiries and exchange contracts. But
the seller will rarely agree to disadvantage himself, especially when the purchaser
may still pull out with no liability whatsoever.
After receiving the
draft contract from the “sellers” solicitor, the “purchasers”
conveyancer will send a long list of printed preliminary enquiries in return
covering virtually everything that needs to be known about the property, including
insurance, guarantees, disputes, any unusual charges and, if not already agreed,
whether the seller intends to remove those fixtures, fittings, plants, aerial,
burglar alarm, telephone, etc. He will also send off an official search, with
a printed list of further enquiries, to the local authority to see, for example,
if the property is subject to any local land charge or any adverse entries; how
drainage is connected, what building or other development has been granted, proposed
roads, compulsory purchase or mining activities past, present or future.
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