For Business

Preparing Property for Sale

Aug 28, 2014

One of the major concerns from clients is the slowness of the conveyancing process. Some delays are outside the control of the seller or the buyer and their respective solicitors, e.g. how long searches take or the issue of finance offers by lenders.

However, there are quite a few things sellers in particular can do to speed up the process.

Possibly through fear of running up a large bill with nothing to show for it if a sale does not materialise, often the first we hear of a transaction is when we receive the heads of terms from the selling or letting agent.

However there are advantages to instructing us at the same time, or even before, the property is marketed.

  • It can be checked if you own the property being sold. If you have a complex unregistered title it is advantageous to register it at the Land Registry.

If selling an investment property it will be necessary to ensure that all the original leases and ancillary documents are to hand.

  • These days most commercial transactions involve the seller or landlord supplying to the buyer or tenant replies to a number of set enquiries known as CPSEs (Commercial Property Standard Enquiries).

These cover a number of matters on which buyers or tenants will need to be satisfied, e.g. VAT, planning, disputes and, depending on the nature of the transaction, insurance and service charges, construction warranties, etc. The forms are quite extensive. A lot of research can be needed to answer them fully.

  • VAT on commercial property is a minefield. Getting it wrong is costly. Have you opted to tax? If not should you do so for this transaction? If you have opted to tax can it/should it be revoked? Furthermore, should you opt to tax, the buyer may well ask for evidence of this. It is surprising how few sellers have this evidence. You can contact the national VAT option unit but they take a couple of weeks to reply.
  • The Environmental Protection Act 1990 contains complex provisions for allocating responsibility for pollution. It is possible when selling property ‘with information’ to pass on any liability for clean-up costs to the buyer in such a way that the seller no longer has any such liability once they sell the property.

To take advantage of this clause the following conditions must be satisfied:

  • The seller, landlord, buyer or tenant must be the person who caused or knowingly permitted the contamination
  • The transaction is at arms-length
  • Before the transaction became binding the buyer or tenant had information that meant it could assess the contamination
  • The seller or the landlord does not retain any interest in or rights to occupy the land

If you have a contaminated site a report should be obtained from a reputable environmental consultant. Although, as said, it is not essential to list the report in the contract, it may be wise to do so. A well-advised buyer may seek a reliance letter or collateral warranty from the consultant, and the terms of his or her engagement should provide for this to be forthcoming if required.

Michael Talbot

About the author

Michael Talbot

The Commercial Property team is led by Michael Talbot. Michael qualified as a solicitor in 1982, having graduated from Nottingham Trent University and Lancaster Gate ...

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