Real Estate – Taking Instructions
Outline of a simple transaction
Seller Buyer
EARLY STAGES
Marketing the property -
The transaction will begin with the seller putting the property on the market.
- Will usually engage in an estate agent.
- Will need to have commissioned an Energy Performance Certificate.
Once a buyer is found, and price agreed, the conveyancing process can then
begin.
- Should be understood that the parties have not entered any legally
binding relationship with each other, and can walk away from the
transaction at any point until exchange of contracts.
Energy Performance Certificate -
Must have been commissioned (even though not received) before the
property can be marketed.
- Obligation to use all reasonable efforts to ensure that it is received
within seven days of marketing.
- If not received, further 21 days.
- Once obtained, estate agent must provide a copy of the EPC with the
sale particulars and in the advising.
- Responsibility of seller or landlord to ensure that a valid EPC free of
charge is given to the person who becomes the buyer or tenant.
- Green Deal – EPC will disclose: Government initiation that enables
property owners and tenants to carry out range of energy efficiency
measures with no upfront cost.
Minimum energy efficiency standard: From April 2018
- Landlords of certain domestic or non-domestic buildings will not be able
to grant new tenancies or renew existing if the building does not meet
EPC rating E.
- A landlord who wishes to rent a sub-standard property will have to
undertake relevant improvements… unless:
▪ obtained an opinion that improvement will have negative impact
on fabric/structure
▪ tenant’s consent has not been forthcoming.
▪ would result in reduction of more than 5% of price
PRE-CONTRACT STAGE Due diligence most time heavy aspect
Take instructions Take instructions
Obtain proof of the client’s identity due to money laundering Obtain proof of the client’s identity due to money laundering
regulations. regulations.
Indirect instructions (e.g. from an estate agent on behalf of the Indirect instructions (e.g. from an estate agent on behalf of the client)
client) must be confirmed directly by the client). must be confirmed directly by the client).
Prepare pre-contract package -
o The draft contract, showing what land the seller is selling
and on what terms;
o Evidence of the seller’s legal title to the property;
o Sometimes, the results of pre-contract searches which the
seller has made.
- Commission survey
- Pre-contract searches and enquiries
Application of the caveat emptor principle which makes pre-contract
searches necessary. Let the buyer beware.
1
Outline of a simple transaction
Seller Buyer
EARLY STAGES
Marketing the property -
The transaction will begin with the seller putting the property on the market.
- Will usually engage in an estate agent.
- Will need to have commissioned an Energy Performance Certificate.
Once a buyer is found, and price agreed, the conveyancing process can then
begin.
- Should be understood that the parties have not entered any legally
binding relationship with each other, and can walk away from the
transaction at any point until exchange of contracts.
Energy Performance Certificate -
Must have been commissioned (even though not received) before the
property can be marketed.
- Obligation to use all reasonable efforts to ensure that it is received
within seven days of marketing.
- If not received, further 21 days.
- Once obtained, estate agent must provide a copy of the EPC with the
sale particulars and in the advising.
- Responsibility of seller or landlord to ensure that a valid EPC free of
charge is given to the person who becomes the buyer or tenant.
- Green Deal – EPC will disclose: Government initiation that enables
property owners and tenants to carry out range of energy efficiency
measures with no upfront cost.
Minimum energy efficiency standard: From April 2018
- Landlords of certain domestic or non-domestic buildings will not be able
to grant new tenancies or renew existing if the building does not meet
EPC rating E.
- A landlord who wishes to rent a sub-standard property will have to
undertake relevant improvements… unless:
▪ obtained an opinion that improvement will have negative impact
on fabric/structure
▪ tenant’s consent has not been forthcoming.
▪ would result in reduction of more than 5% of price
PRE-CONTRACT STAGE Due diligence most time heavy aspect
Take instructions Take instructions
Obtain proof of the client’s identity due to money laundering Obtain proof of the client’s identity due to money laundering
regulations. regulations.
Indirect instructions (e.g. from an estate agent on behalf of the Indirect instructions (e.g. from an estate agent on behalf of the client)
client) must be confirmed directly by the client). must be confirmed directly by the client).
Prepare pre-contract package -
o The draft contract, showing what land the seller is selling
and on what terms;
o Evidence of the seller’s legal title to the property;
o Sometimes, the results of pre-contract searches which the
seller has made.
- Commission survey
- Pre-contract searches and enquiries
Application of the caveat emptor principle which makes pre-contract
searches necessary. Let the buyer beware.
1
