Question to the Department for Levelling Up, Housing & Communities:

To ask the Secretary of State for Levelling Up, Housing and Communities, if he will bring forward legislative proposals to introduce a limit on the level of legal fees that can be imposed upon a homeowner trying to sell their home in the event that the buyer pulls out late in that process.

We recognise that the process for buying and selling homes in England and Wales can be frustrating. In our response to the Call for Evidence for improving the home buying and selling process, we set out actions we will take to make the process more efficient and less costly.

One part of this work is encouraging the adoption of voluntary reservation agreements. These would see buyers and sellers committing to the sale once an offer has been accepted and may include both sides making a financial commitment which would be surrendered to the other side if the party withdraws without good reason. These agreements will provide more certainty for both sides as the sale moves forward to completion; reducing the risk of parties withdrawing from transactions. In the event a party does withdraw the other side may get some financial compensation to cover their costs.

In order to be widely taken up, reservation agreements need to be attractive to buyers and sellers, and promoted by estate agents and legal representatives. Following behavioural insight research, work is now continuing to develop the agreements to make them an effective tool in improving the efficiency of home buying and selling and we hope to be able to evaluate their effectiveness next year.