Report comment

A point which does not seem to have been adequately addressed is the disproportionate cost for a firm to act for a buyer of just one house of flat on a large new development. Title may be complex with old restrictive covenants and easements to consider, s106 agreements, s278 agreements, the NHBC or equivalent scheme being used and then the terms of a complex lease and a purchase contract.

As buyers generally think conveyancing can be done for under £1000 they are not prepared to pay the true cost of doing a comprehensive job. Hence the nominated solicitor is seen as attractive. Once the first few units are sold the developer does not want to change its "standard documentation" so even independent solicitors are told take it or leave it. In a Seller's market, buyers take it.

It makes sense, on one level, for one firm (or two) to become familiar with the development and the documentation and then to act for multiple buyers. The problem of course is that the firm is beholden to the developer for the workflow now and in future and the temptation to not stand up to the developer/seller is ever-present. The developer will also want the nominated firm to keep its fees low so that the fees are attractive to buyers (reinforcing the message to buyers that resi conveyancing is cheap as chips!).

I cannot see an easy solution to this. It would be interesting to hear from any solicitors who were sacked as preferred solicitors for standing up to unreasonable terms in a sale contract or lease.