Conveyancing will always refer to the transfer of property from one owner to another. However, it’s the conveyancing process and the environment around property transactions which can change over time. This is an important area of consideration for buyers and sellers of both residential and commercial property, as well as businesses. In this article, we discuss the biggest changes in 2024 that are likely to impact conveyancing going forward.
Changes affecting conveyancing in 2024
At the time of writing, the housing market continues to competitive. According to the Office for National Statistics and Statista, the price of the average UK house has risen from £167,716 to £290,000 in the last decade. This has had a wide ranging impact on the nature of property transactions, from making purchases more appealing to property investors to making it harder for first-time buyers to break into the market and much more. However, there are also political and legal developments that will be likely to influence the role of property solicitors and the conveyancing process overall.
Ban on the sale of new leasehold properties
The Leasehold and Freehold Reform Act has become law, meaning all new house in England and Wales will be freehold from the outset. This is designed to strengthen the rights of homeowners and make it easier for leaseholders to have greater control over how they manage their property. If you are in the process of buying an existing leasehold property, you might be able to negotiate on price.
Energy efficiency of real estate
Climate change is a major focus for new property developments. Landlords are encouraged to improve the energy efficiency of their properties due to the existence of Green Leases, as well as standards outlined in The Energy Act 2023. Emphasising the energy performance of a property is now essential for owners to get the most out of their property sale. Another development has been the roadmap set out by the Solar Taskforce within the Government’s Department for Energy Security and Net Zero. According to the taskforce statements, commercial properties might be analysed for their suitability to accommodate solar panels and other solutions.
Read ‘Green Lease: What you should know’.
Minimum Energy Efficiency Standards (MEES)
Currently, buildings are required to achieve a minimum energy Performance Certificate (EPC) rating to be considered as energy efficient under the standards. The main points are:
- Buy to Let residential properties must have an EPC rating of E, which is set to increase to C by the end of 2025 according to consulting documentation.
- Commercial properties cannot be rented out if they have an EPC rating below E, with the indication that this will increase to C in 2027 and B in 2030.
The result is that landlords have clear deadlines to make improvements to their properties or risk losing the ability to let the premises to tenants. For buyers looking to purchase a property in the next few years, the energy performance certificate should be a major consideration when evaluating the quality of a property investment.
The Building Safety Act 2022
While this law has been introduced before 2024, many amendments are likely to broaden the impact of the act going forward. This will probably impact new build properties most heavily due to the focus on developers, but facilities managers and private landlords will be impacted as well. Provisions apply to properties of a wide range of building types.
Possible changes to the Landlord and Tenant Act 1954
It was announced in Spring 2023 that the Landlord and Tenant Act would be reviewed by the Law Commission. After multiple delays, problems and solutions for the existing law are expected to be published in Autumn 2024. It is expected that the proposed revisions will address areas of the law relating to landlords and tenants that is outdated in both residential and commercial settings.
Looking to the future in conveyancing
As technology continues to advance and regulatory frameworks evolve, commercial property conveyancing is expected to undergo significant changes. With the rise of smart contracts and blockchain technology, the future of conveyancing for residential and commercial property investment is likely to see further digitisation and automation. Smart contracts have the potential to streamline the transaction process even more by automatically executing terms of the contract once predefined conditions are met. This could lead to quicker transactions and reduced risk of errors in property deals.
Other advancements in technology such as online platforms and secure digital signatures are revolutionizing the way property transactions are conducted. These advancements streamline the conveyancing process, reducing paperwork, and increasing efficiency for both investors and conveyancers.
The impact of regulatory changes on conveyancing
While 2024 has seen many regulatory changes proposed and implemented, there will be future legal developments that effect on the conveyancing landscape. Changes in legislation, compliance requirements, and market regulations are all factors that can influence how conveyancing is conducted. As expert conveyancers, we must stay up to date with these changes to ensure our services are accurate and compliant.
Furthermore, environmental considerations and sustainability requirements only promise to become more important in commercial property transactions as we get closer Carbon Net Zero. A property conveyancer needs to assess and advise clients on the environmental impact of properties, compliance with green building standards, and potential risks associated with climate change. This shift towards sustainable investing is reshaping the due diligence process in conveyancing and influencing investment decisions in the commercial property sector.
Friendly, fixed fee conveyancing
At Toomey Legal, we don’t believe in surprising our clients with unexpected conveyancing fees. Whenever conditions change in the world of property, our team take the time to understand the ramifications and what it means for buyers and sellers in the local area. Our expert conveyancers provide legal advice and support that’s tailored to the property, the location, and the individual. Contact us if you have any questions about what’s involved in the conveyancing process.