Leaked documents from recent high-level meetings between multiple government agencies imply that serious consideration is being given to the introduction of statutory penalty charges on vendors and purchasers who withdraw from previously-agreed property sales transactions.
A ‘Pull-Out Payment’ of 10% of an agreed sale price would, it is estimated, reduce fall-throughs to just 1.0425% from the present level of 28.8%.
Ministers have expressed concerns that estate agencies are being exploited and disadvantaged by vendors who milk the ‘no-sale, no-fee’ system and walk away from transactions, leaving agents carrying the costs of marketing and losing those agents thousands of pounds in commission. Purchasers too can change their minds and exit an agreed sale at little or no cost or consequence.
A spokesperson told EYE: “The unjust use and abuse of estate agents has been going on for decades and the proposition of putting in a pull-out payment has been met with an enthusiastic response from Ministers.
“The health of the estate agency industry is a matter of great cross-party concern and it does appear that government is prepared to act in order to safeguard the interests of those who work so diligently to keep the nation on the move.
“We expect the draft legislation to be introduced to Parliament in the autumn and to be fast-tracked into law by Christmas.”
Agents have welcomed the initiative. The National Association of Property Purveyors said: “It’s great news and long overdue. Do we get a cut?”
New report seeks to reduce property sales fall-through rates
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