Agricultural Brief – What to do when you’re expecting (to sell)
15 January 2020
When you are looking to sell a property, a title review before it is placed on the market or a sale is agreed can save you time and money.
The New Year (and in this case, a new decade!) is usually seen as a time of opportunity. You may be looking to sell land and/or property to help raise the necessary funds to help you realise this opportunity and there is nothing quite as frustrating as something going wrong or delaying the sale once terms have been agreed.
There are many issues (some common and some not so) that can be spotted and dealt with before a property is placed on the market. The advantage of this is that often the solution to these problems is far simpler when a buyer isn’t involved and the solution can then be implemented before a buyer is found. Some recent examples are below.
- We acted for a client who was about to sell their farm. On a review of the HM Land Registry title, it was noted that various small areas appeared to be unregistered and that the boundaries of the titles didn’t quite match up with the position on the ground. We were able to correct this before the property came to market which avoided the complexity (and additional expense) of dealing with both registered and unregistered land and the seller was also able to pay a reduced HM Land Registry on their first registration application.
- We acted for a client where, upon review, it was noted that a right of way that was believed to exist over a field, in fact, did not. We were able to ensure that the requirement to grant this right of way was included within the sales particulars and thus any potential buyers were aware of the requirement to grant the right of way when they made their offers. The alternative would have been approaching the buyer once the sale had been agreed to ask for the right to be granted and this may well have resulted in a price reduction.
- A new client approached us for some advice as they were about to place a number of farm buildings (10+) on the market. The buildings were all subject to unwritten tenancy agreements and we were able to reduce these all to writing and have them signed by the tenants before a sale was agreed. There was a concern that the tenants may be difficult or refuse to sign if thought a sale had been agreed as we would be in a weaker position but this was successfully circumvented. This also had the added bonus of being able to present the written leases to prospective buyers which was undoubtedly a more attractive proposition than a property being subject to unclear occupation arrangements.
- A further example of the value of preparation from the other side of the fence is shown from a recent purchase transaction. Upon investigation, we noted that the boundary of the property shown on the sale plan and the boundary of the property owned by the seller in accordance with the title deeds were different. Although the discrepancy was subtle, this may have prevented access to one building and we asked the seller to rectify this. Time and expense were incurred by all parties in the month after this discovery as a solution was sought. This is something that could have been avoided if the seller had considered the boundaries before the property was placed on the market.
The above are just a few examples of where problems have been (or could have been) found and solutions implemented on an early review of title prior to marketing. It is worth noting that being asked to consider a property in this manner before it is sold does not necessarily lead to an increase in costs – in fact, it can lead to your legal fees overall being cheaper as finding a solution in circumstances that do not involve pressure from a buyer is often simpler to implement than if a solution is required later in a transaction.
This article is from the winter 2019 / 2020 issue of Agricultural Brief, our newsletter for farmers, landowners and others involved in agriculture. To download the latest issue, please visit the newsletter section of our website.
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The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at January 2020.