Could the lack of documentation affect the ability to resell proposed property

[Zippy777]

Good evening,

We are close to an exchange of contracts on a property and the property has been extended but not admitted to by the vendor and her solicitor.
The following question and answer explains the current position of the vendor.

Q:Our conveyancer asked if the property was extende and to confirm when the works were carried out and if within within the last
ten years, to provide Planning Permission and Building Regulation Approval together with
Completion Certificate


The vendor's lawyer replied that there was no extension done to the property - only converting an existing garage to a room approximately 28 years ago.
A level 3 building survey has been done of the property and confirmed the existence of a single-story side, and rear extension and a double story extension probably built in place of the garage at the front of the property. (all ok).

Our conveyancer is not being very helpful and has just asked us whether we want to go ahead with the purchase or not - without the documents.
We are concerned about completing on this purchase as the vendor has not even admitted to any extension work apart from the garage room which was done before the vendor was the legal owner and do not understand why the vendor’s lawyer has not entered into a discussion about the extensions.

We would like to know if the lack of a building/completion certificate for these works could impact upon our ability to sell the property in the future (even though it is likely that the work was done around 30-35 years ago. A local search showed planning permission for a single story side and rear extension in the late 1980s but no other documents (eg completion/building regs). Therefore there is nothing visible in the search for the front double story extension.

Future buyers may have the same concerns that we have. The vendor has refused to provide indemnity insurance for the garage room and the breach of covenant that requires permission to build on the property. (covenant is over 90 years old). The seller has ticked a box on the question that asks if the property has been extended – just the garage room which actually has a bedroom above it comprising a double story extension.

In conclusion, do you think that there are risks attached to purchasing this property especially in terms of the ability to resell? The ability to resell without a hitch is very important to us. We can get an indemnity insurance policy against enforcement of course but it is the lack of permission and certificate for the whole works.

Thanks you for reading and I am grateful for any advice. The vendor wants to exchange imminently.

[R0b]

The vendor wants to exchange imminently.

I'm sure they would like to.

The ball is really in your court and your conveyancer should really be advising of the consequences and recommendations as part of their role (possibly this is where instructing a solicitor rather than a licensed conveyancer works better but not always).

I had a similar issue where there was a planning/building regulations issue for the property I purchased when the previous owner decided to knock through a wall. I insisted the seller should pay and they did agree to pay for indemnity insurance policy as they're normally about a few hundred quid give or take and it also benefits subsequent owners too with no expiry date. But also the flip side to the argument is that you and any subsequent owner should pay since you are going to benefit from any enforcement action.

My understanding is that there are time limits for planning permission and building regulations. For planning permission, enforcement cannot be taken after 4 years for certain things like extensions but for other matters that need planning permission the limit is 10 years. For building regs enforcement, it expires after 12 months. No time limits apply to listed buildings.

If you are confident the work was done some time ago being 30-35 years, then you might be ok from any kind of enforcement so the question of liability doesn't come into play if it is not a listed building.

Having said all of that, I think your bigger concern would be the restrictive covenant to obtain planning permission. There are usually no time limits for covenants and they usually run with successors in land. So even if the local authority can't catch you on the planning/building regs, they probably could get you on the covenant to obtain planning permission.

How much do you want the house and are you willing to take the risk? Personally I would probably stand my ground on getting appropriate restrictive covenant indemnity insurance and planning/building regs for a belts and braces approach. If the seller is not willing, I would be prepared to walk away unless it was my forever home, then I would have to weigh up the issues. The threat of walking away may be enough where they agree to your demands.

Side note: If the seller responses were part of the replies to inquiries then you may be able to sue them for misrepresentation but then that is likely to come at a massive cost and should really be your last resort. Property litigation is expensive and you are not guaranteed to win.

[Zippy777]

Thank you very much. Do you or anybody else think that we could have difficulties reselling as we do not have a building regulations certificate and it may be difficult to get a regularisation certificate?

[islandgirl]

Not my area of expertise but the very fact that you are here asking these questions means a future purchaser may feel exactly the same. I would worry and would probably want it sorting before I bought the property.

[dslippy]

Do not buy somebody else's problem.

[R0b]

Thank you very much. Do you or anybody else think that we could have difficulties reselling as we do not have a building regulations certificate and it may be difficult to get a regularisation certificate?

How long is a piece of string? Nobody would be able to give you a definitive answer as it would depend on a number of factors but what I can say is that the standard form used by most conveyancers for enquiries will almost certainly have a question on building alterations and one of those questions is likely to be whether the seller i.e. you are aware of any breaches of planning permission or building regulations. Since you have to answer truthfully, your response will likely trigger further questioning from the buyer and/or give them cause for concern where they may walk away or request that you pay for any indemnity insurance as part of the sale.

Your biggest worry should be that the council finds out no planning permission has been granted for the extension works and they order you to rip it down, seek retrospective permission or take you to court if you refuse. The reality is that they probably won't find out about it unless one of your neighbours complains or someone who knows that no permission has been granted and they dob you in to the council. Even if they did become aware, the council may assume that enforcement rights have expired and not bother checking the title deeds to see if they have any rights but that's not a guarantee.

If you really want the house, make some enquiries about indemnity insurance and the cost of it before exchanging contracts. make sure to get the appropriate insurance coverage in place before exchange as a safety net and double, triple check that you have everything you need. You would be wise to try and obtain this through your conveyancer so if something goes wrong you may have a claim against them for negligence. You would probably want indemnity insurance coverage for the planning permission and the restrictive covenant but you may get away with the restrictive covenant insurance.

[sandfordboy]

Surely any reasonable seller would have readily disclosed the overall situation & prepared to purchase the relevant indemnity insurance/s ? I hear from others that this is a regular occurence."Cards face up on the table". If I was dealing with a seller like the one you seem to be - I would walk away. I suspect there will be other issues hidden in the sale. DSLIPPY has it right.