Rejoice! Reservation Agreements are coming...

29/1/2019 1:53 PM

In the last quarter of 2018 49.8% of all sales fell through! Chains collapsing often has a far reaching impact. If you speak to anybody who's bought or sold a home, there's a pretty good chance that they've had a purchase or sale fall through.

Politicians are currently studying a model 'Reservation Agreement' which has been prepared by a law firm as a possible way of slashing fall through rates. Ministers are currently considering how these agreements could be used including things like "how much money should be put down", and "in what circumstances the funds may be refundable".

According to a survey conducted by Department for Business, Innovation and Skills some 50% of buyers, and 70% of sellers would be happy to enter in to a reservation agreement.

There are already methods available to sellers to ensure minimal fall through rates, such as the 'Modern Method of Auction' AKA 'Committed Transaction Method'. The fall through rates for this method of sale is just 3% according to 'I Am Sold'. This method is not right for everybody, so I am personally delighted to see the Government taking steps to improve the sales process.

If you'd like any more information on the modern method of auction, give me a call! It's not just for run down houses anymore!

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