The importance of ordering a planning search
2014 saw over 1,100,000 residential property transaction completions – over 200,000 more than the previous year – and the 7 months up to 31st July of 2015 has seen 399,394 transactions (1). The average UK house price was recorded as £183,861 in July 2015, a 4.6% increase on the previous year. This follows the moderate house price increases the UK has experienced since April 2012 and is driven in large part by increases in London with the average price of property in the capital soaring to £488,782 (2).
With house prices set to rise even further as demand for housing increases, it is more important than ever to ensure that purchasers are choosing the right home for them and are aware of all potential developments well ahead of purchase.
Large scale developments are not always identified in the suite of mandatory searches, such as the CON29 Local Authority search, and may only be picked up by specialist companies.
In any property transaction it is heavily advised the purchaser employs ‘caveat emptor’ – buyer beware, as all may not be as it seems when viewing a property over a number of weeks. With a housing shortage as great as the UK’s, the Government and developers are under pressure to build more and more, and properties can be seen popping up left, right and centre. However, this may be at times when the future purchasers have already made an offer, as has been seen in the recent case of Thorp and another v Abbots and another . In 2010 the Abbots sold their home to the Thorps for £625,000. A Sellers Property Information Form (SPIF) was completed, which didn’t reveal anything untoward (3). However, after the purchase the Thorps were made aware of proposals for large scale developments in the area, proposals which dated back to before they purchased the property and it was still in the Abbotts’ ownership. Although the proposals were not set in stone, the Abbots (the sellers) attended meetings, received a public notice advising of the developments and even signed a petition against the development yet they did not disclose this information on the SPIF, when asked 1. “Has the seller either sent of received communications or notices which in any way affect the property (for example from or to neighbours, the council, or a government department)” and 2. “Has the seller had any negotiations or discussions with any neighbour or any local authority affecting the property in any way? If yes, please give details” probably to ensure their property was sold.
The Thorps took the Abbots to court, however the High Court was found to be in favour of the defendant and the case was dismissed. The lesson to take away from this is to not always rely on the sellers to disclose all information and conduct your own independent research ahead of purchase.
In another case, leading solicitors Bird and Bird have been found liable in the High Court for a £2 million breach of duty after failing to advise their client of a major development close to her £25 million London property. Ms Chow had paid a £2.5 million deposit on the 7 bedroom property in NW8, and her solicitor had undertaken a planning search which disclosed the plans for a new academy school, housing 1400 pupils and some 6 stories high, yet failed to mention the matter in their report in title (4) – presumably due to the distance from the property, a mere 91 metres. Not only do large scale developments such as this have a negative impact on the aesthetics of a property, there are other lasting effects such as increased noise and air pollution as well as traffic.
Planning searches are not always the easiest to navigate, especially in large urban areas where there is a wealth of information. For this reason Groundsure has drawn on our expertise in data analysis and developed a planning report with professional opinion in conjunction with PlanVal. This new report takes the interpretation away from the solicitor (instead utilising the expertise of our in-house Environmental Consultants) and highlights any potential major issues within an area.
There are two distinct and important conclusions to draw from these high profile cases – the first being that all purchasers should be aware of the first rule of a conveyancing transaction is to employ ‘caveat emptor’ (buyer beware) especially of sellers not disclosing information and should undertake their own independent enquiries. The second is to ensure that you thoroughly read your reports and discuss any potential issues with your solicitor or search provider.
2. Land Registry House Price Index July 2015 https://www.gov.uk/government/uploads/system/…/July_HPI_2015.pdf
This article was submitted to be published by Groundsure as part of their advertising agreement with Today’s Conveyancer. The views expressed in this article are those of the submitter and not those of Today’s Conveyancer.