How to sell up and avoid the fees
Are you in a retirement property, and in a position of trying to break free fron Peverel? Maybe you’ve decided to move. Or maybe bereavement has forced a sale.
Here are a few pointers to guide you on your way, which have been collated from actual experiences.
However, if any of you have anything to add – please put a comment on this site. There may be other helpful hints out there for sharing, and we will keep the information updated.
Sell with Peverel
The Peverel Web includes its very own in-house estate agent: Retirement Homesearch. If you want to put more money in the Peverel Pocket, go right ahead and use them.
However, it would be wise to do some checking first. For example, does your lease include a requirement to use Retirement Homesearch when selling?
It is very doubtful. It’s much more likely that you’re free to use any agent you choose. Nevertheless, don’t be surprised if you are pressured to use them – particularly by house managers.
House managers show prospective purchasers round on behalf of Retirement Homesearch – and receive a kick-back for any successful sale they are involved in. (A contributor to the Peverel Action website states the amount is currently £150.)
So don’t be surprised if they push this option. Or even give the impression you’re obliged to use them.
Don’t be misled! Check your lease, and local agents’ fees and services. You might be pleasantly surprised how they compare.
Also, before committing yourself, check how the advert will appear. We’ve seen Retirement Homesearch advertising specific flats for sale online, but the details turn out to be generic ones, which could apply to any of the properties in the development. We don’t believe Retirement Homesearch does any measurement or photography. Not useful for prospective purchasers! And exceptionally lazy.
Your lease undoubtedly prohibits the display of an agent’s board. However, there will most likely be a generic board outside, to alert passers-by that there are retirement properties for sale. If the board only mentions Retirement Homesearch – complain vigorously. This is probably not only in contravention of the lease, but also represents a restraint of trade.
Some developments put a list of properties for sale on the internal noticeboard. You are entitled to have your property included on the list. It’s not just for advertising the Retirement Homesearch ones.
In 2010 & 2011, Mr Edwards (Company Secretary & Head of Peverel Legal Services) confirmed the following to one of our contributors, so we have no reason to believe this doesn’t apply nationally, for everyone:
“Our house managers (HMs) are not permitted to hold sale brochures in relation to flats for sale. The instruction given to them is that they should maintain a list of properties for sale and provide copies of the list upon the receipt of any enquiry. We do not ask HMs to hand out brochures for any estate agents, including Retirement Homesearch (RH). …
“I can also confirm that House Managers (HMs) are provided with a financial incentive when they are involved in a successful sale through Retirement Homesearch (RH).
“The incentive provided is extremely modest and is by way of recompense for the time they have spent in dealing with the sale.
“In this regard, HMs are expected to deal with the sale in addition to their normal duties and consequently would be expected to work extra hours or forego their break periods in order to deal with any sales. In reality the time spent by HMs dealing with RH sales is very low.
“The correct position is that house managers (HMs) are encouraged to assist in such (other) sales to the extent that they are authorised to provide access to the premises and to conduct tours of the common areas within the development on behalf of other estate agents. HMs are not, however, permitted to undertake viewings of individual flats which are placed with other estate agents …
(Mr Edwards assures that) “your flat will be included in the list of flats for sale on the notice-board of the development, (and) clarifies that this will obviously apply to anyone else who places a flat at the development on the market through an agent other than Retirement Homesearch.”
And – to avoid any doubt – make sure the house manager doesn’t hi-jack your own viewers to look at the flats she’s promoting. Yes – it has happened!
Peverel’s property transfer department deals with their legal side of the sale process. They have helpfully collated a “solicitor’s pack”, which they charge a pretty price for.
There is absolutely no requirement to pay for this. You will already have much of the information – especially if your record-keeping has been good.
For example, if you’ve kept service charge and budget documents going back a few years. Before you part with any hard-earned cash, find out what’s in the pack, and ask your solicitor what they need.
There will be the odd document you have to pay for – but that’s all. It’s tempting to think your solicitor needs all the stuff, simply because the pack is available. However, a bit of homework will save you money.
A good example is the “purchaser information guide”. Peverel has produced a nice bright shiny (and expensive) one. (Which you might expect to be on their website to download, in these modern times, but we can’t find any sign of it.)
You will have received a guide when you bought the flat originally. Find out if it’s the up-to-date version. If it is, you can photocopy it. If not, the development will have its own copy, available for everyone to read. Photocopy that one. It will only be around 40 pages.
The final sting in the tail – the reviled exit fee. This is a percentage of the final selling price (often 2 per cent), which has to be handed over from the sale proceeds.
If you don’t hand it over – Peverel won’t register the sale at the Land Registry. And it’s ‘in the lease’.
You may think this means you’re stuck with it. Certainly, the one per cent which is destined for crediting to the contingency fund, for the benefit of keeping the maintenance charges lower for future leaseholders, is believed to be fair. The other one per cent, however, goes straight into the landlord’s pocket – and it is this which has been (and continues to be) the subject of an Office of Fair Trading investigation.
Following countless complaints, the OFT commenced an industry-wide investigation into the practice of charging ‘exit fees’ in November 2009.
Their website is updated from time-to-time with progress. The most recent update was in April this year, and alluded to the negotiations they are undertaking with Fairhold on this matter.
However, the OFT is being cagey, and it’s a question of ‘watch this space’. We are all hoping the OFT will rule that the exit fee represents an ‘unfair contract term’, and is consequently unenforceable.
However, if you need to sell before they come to a conclusion, it is vitally important that you make it clear you are paying the fee ‘under protest’, or ‘under duress’, and that you expect it to be refunded if the OFT rules, at some future date, that the fee is unfair.
Your solicitor will have a suitable form of words to express this, but unless you point it out, they may be unaware of the on-going deliberations.