Predictions for the Property Market and Conveyancing Industry
Lloyd Davies, Managing Director and Founder of specialist residential conveyancing practice Property Transaction, who has worked in conveyancing for over 30 years, said the industry had faced its most difficult time since the Second World War during the pandemic with “five quarterly Christmas and SDLT deadlines, a massive backlog of work as well as the disruption to office working”.
And he predicted that while 2022 may be “steadier”, prices would continue to rise, explaining:
“I believe that the pandemic will continue to have an impact on our work and lives, perhaps for several years to come, but most conveyancing practices have adapted to home working and restricted access to the office and have been operating at full capacity for most of this year.
“Transaction volumes are still high, although the number of properties on the market is a concern. Demand will continue to outstrip supply as stock is low and so house prices will continue to increase next year – at an average of 8 – 9% I believe. Transaction attrition rates will decrease as purchasers will need to follow through due to the lack of properties to choose from.
“Volumes will remain high I believe, at well over a million residential property transactions, following on from the record residential sales year in 2021, forecast to be the busiest year since 2007, and just over a million sales in 2020 and close to that in 2019.”
“The migration away from the cities will continue with city spaces being filled readily by eager youngsters and first time buyers. Prices in rural and coastal areas will rise well above those in the cities as home working and the choice of locality is now a reality for so many.”
Mr Davies, whose charity arm The Conveyancing Foundation introduced the successful ‘Be Kind We Care’ campaign in 2021 to encourage professionals to be kinder to each other following complaints from conveyancers that they were being treated unfairly by some fellow professionals, said he believed businesses had learnt that prioritising staff welfare was vital.
“One thing we have all hopefully learned from the last 18 months is to accurately measure and ensure that our Conveyancers are not overloaded with work; that they take regular time away from the office on holidays to avoid burnout; that they don’t overwork from home and that they look after themselves and each other.
“We have adopted a hybrid of home and office working, with Conveyancers choosing what works for them so long as service standards and targets are met effectively. Choice and trust have become the norm for most legal practices with their staff and this can only be a good thing for both the businesses and the people involved in our industry.”
“I believe that there has been a shift in the way that Conveyancers and Estate Agents liaise with each other, with a more professional and understanding approach becoming more prevalent. The wellbeing initiatives engendered by the industry such as the “Be Kind We Care” initiative will continue to drive standards up in the industry, as poor behaviour amongst professionals is no longer acceptable, and industry leaders are enlightened as to how they can get the best out of their teams through wellbeing initiatives and training.”
He also forecast “an increase in staff training and recruitment in the conveyancing sector” with “the advent of Government funded apprenticeship courses and excellent new pathways for professionals within the conveyancing industry meaning the number of youngsters qualifying as Licensed Conveyancers and Solicitors will increase, adding:
“Novices can now be trained to full conveyancing fee earners within 12 months with their wages increasing from £18k to £30k in that time period.”
Mr Davies, who is also Managing Director of Convey365 which will launch its ground-breaking IT case management systems in 2022, said that he anticipated conveyancing timescales and processes would also improve cross-industry in 2022 with Government help and reform.
“I hope that we will see some changes to conveyancing protocol and the Government intervening to kick start the changes needed to change the way that we convey to make it quicker and more effective for all concerned.
“I would like to see Legal Contract Packs, approved by the seller’s Conveyancer, prepared at the point of marketing or within three weeks of the property being placed on the market. This will speed up the time to exchange from offer by 3- 4 weeks and is a no brainer. We need to look at conveyancing digital protocols and implement them – greater input from our regulators will be required in this respect.
“A word of warning on the conveyancing changes required. To facilitate change, the changes should be non-evasive where possible and gradual in terms of processes. An example is changing the process of ordering searches at the start of a transaction by the seller. Asking sellers to pay for the cost of property searches as well as a Legal Sellers Pack could amount to £500 – £600 extra per transaction and could curtail properties coming onto the market in the first instance – not a good thing at the moment.
“We need one protocol across the industry, not varying ones for each regulator, and we need to be mindful of the impact of change on the businesses of professionals in the industry. Completely changing processes and procedures takes time and is disruptive – and we could all do with a break from the disruption of the last 18 months!”
“I think that we will see the electronic signature of deeds come to fruition next year as well as systems and defined procedures to enhance client identity measures, curtail cyber fraud and money laundering. The events of 2021 and the Simplify group with their IT systems being the target of a cyber-attack sent shockwaves across the industry and we are yet to see the full impact of the slowdown of instructions to the conveyancing giant, which was undertaking thousands of transactions every month.
“It is an exciting time for our industry and we need to grasp the nettle and work collectively to implement the changes required to make conveyancing faster and safer for all concerned. I am looking forward to something resembling “normal” and pre 2020 for next year, although based on November volumes of work it looks like the seasonal dip in completions in March and April will not materialise next year and we are in for a busy time.”January 4, 2022