The inefficiencies in England’s conveyancing system were highlighted today by new analysis showing some firms receive 83 times more requests for information from HM Land Registry than others, leading to significant delays in property transactions.
Technology consultancy Novus Strategy found that the number of Land Registry queries raised against conveyancers varied by an “alarming” 8,176%, ranging from 2.9 per 100 applications to 237. The industry average stands at 11.7.
Requests for information, previously known as requisitions, are issued when Land Registry cannot process an update because information is missing, incomplete or incorrect.
Each one typically delays a transaction by three weeks, with the agency warning that avoidable requests cost the industry as much as £19.1m annually.
WIDE INEFFICIENCIES
Of 5,742 organisations filing register updates, 135 firms received more requests than the number of applications they submitted. At the other end of the scale, 393 organisations reported none at all, although many were cases where property ownership did not change hands, such as remortgages.
The impact of such inefficiency is felt widely. Lenders face higher funding costs and risk tighter margins, as unpredictable completion times tie up capital. Longer pipelines also raise the likelihood of fall-throughs.
Estate agents, brokers and developers see revenue and cash flow affected, while consumers risk losing out as mortgage offers expire in a high interest rate environment.
HORIZONTAL DIGITAL INTEGRATION
The Land Registry has announced a digital registration service, due to launch in October, which will introduce automatic checks to prevent invalid filings. Industry leaders are also promoting a wider drive towards “Horizontal Digital Integration” – a framework developed by Novus Strategy to improve interoperability across the homebuying process.
Identity checks alone accounted for 195,000 avoidable Land Registry queries last year, underscoring the need for joined-up systems.
OPPORTUNITY KNOCKS
Chris Williams, founder of Novus Strategy, says: “While the particular circumstances of these transactions and the exact mix of conveyancing business attended to by these firms are unknown, this clearly illustrates the scale of the opportunity that presents itself.
“The cost and duration of transactions can and should be slashed by the amount of innovation we see moving into the homebuying industry at the moment. That’s very welcome after years of slow progress caused by an absence of interoperability.
DIGITAL MATURITY
But he adds: “While these figures are quite alarming, transformation is on the horizon now thanks to the adoption of HDI strategies, where these sorts of queries should largely evaporate if the sector can create seamless data handoffs in the property transaction process.
“A level of digital maturity has been reached across the home buying and selling ecosystem, and we’re seeing lots of innovations coming forward, not least Land Registry’s own digital registration service and its move to accept qualified electronic signatures.
“It means shared verifications, permissions, open networks and common data standards will consign manual rekeying of information and endless delays to history, with higher margins, scalable capacity and a better customer experience to boot.”
