Local searches are a significant cost in buying a property – but should buyers really have to pay for information that is in the public domain?
Conveyancing searches of various sorts, but especially local searches, are a necessary part of buying a home. And the cost of these usually falls on buyers. It was part of the argument against Home Information Packs that sellers had to pay for a local search before a property could be marketed, so sellers were happy to see such packs abolished.
But it seems that people do not question the fact that it is necessary to pay fees to local councils for providing replies to searches. It is generally assumed that providing the information is a service that has to be paid for – and search fees can often exceed £100.
I was recently reading a book written by an American journalist who has lived in England for some years. The author had made a study of the ways in which the UK government agencies are acquiring more and more information about everyone.
But she also commented on the fact that it is harder and more expensive for individuals to obtain this information than in the USA – I gather that American citizens can obtain a lot of publicly-held information for free.
Abolish fees for local searches
This set me thinking – as local councils are public bodies why should they charge for providing information which they hold about someone’s property? After all the information is in the public domain, and usually relates to some action the council itself has taken which affects a property.
For example a council might have created a conservation area which includes a property, or be planning some major roadworks which will affect it. It might even be planning to acquire it under compulsory purchase powers for a new bypass.
So why shouldn’t property owners be able to obtain all the information which the council holds on their property without having to pay for it? After all they will probably have been paying council tax. If this was possible then sellers could obtain the search information when putting a property on the market, so that it would be available to a buyer without charge.
Drainage and water searches should also be free
The same argument also applies to drainage and water searches. Back in the day information about drains and sewers was held by local councils and formed part of the local search. But as responsibility for drainage was handed over to the water companies, a separate search now has to be made to check whether or not a property is connected to mains drainage – an additional cost for the buyer.
Since the water companies have been privatised they are happy to sell this information to buyers, together with information about the property’s water supply. But should not this information be made freely available? – such companies are monopoly suppliers and are essentially public bodies.
Why not reduce or abolish Land Registry fees
The author of the book also complained about the Land Registry charging for supplying copies of registered titles and related documents. As the charges for supplying such copies are usually only a few pounds and are met by the seller most buyers do not complain about them. But the principle is the same – the Land Registry is a government agency and should supply details of an owner’s title without charge.
When first set up the Land Registry’s job was to register property titles and dealings with titles such as transfers and mortgages. It was headed by a lawyer as its work involved property and conveyancing law.
But much of that has now changed – it is now a self-financing agency headed by a supervisory Board. Although it still deals with title registrations it also now seeks to generate additional income from the sale of what it describes as “Add Value services” – in other words, selling information which it holds because property owners are obliged to register titles with the Registry.
It is indicative of the Registry’s change of direction that it its day-to-day management is now in the hands of an executive board which only includes one Solicitor. Most of the other members of the board have backgrounds in finance and commercial management, and have such titles as Director of Operations and Commercial & Customer Strategy Director.
Clearly the Registry has changed from being a government department providing essentially a legal service to a commercial entity looking to make a profit. Indeed there have been rumours that privatisation is on the cards, and certainly its current management structure would make that possible.
But it should be remembered that the Land Registry’s principal ‘customers’ have no choice over using its services. If a property transfer is not registered then the buyer will not have a good title to the property. So the fees which it charges buyers for registering property transfers are essentially a further tax on home ownership.
Fees are charged on a sliding scale depending on the value of the property. The current fee for a property changing hands for between £200k and £500k is £270 – is this really justified when in most cases all that the Registry has to do is to change one name for another on the computer (and perhaps substitute the name of a different mortgage lender)?
The Land Registry might be justified in selling information to commercial organisations if this meant a substantial reduction or even abolition of registration fees, but so far there has been little sign of that happening.
Government ministers are fond of criticising the cost of legal services, but as far as conveyancing goes perhaps they should be looking at reducing or even abolishing fees for local searches and title registration. These fees all add to the cost of buying a home, but are entirely outside the control of buyers.