Conveyancing is causing delays, warns Law Society
The Law Society says serious shortcomings in Ireland’s conveyancing system can delay house sales by up to five years in extreme cases.
It warned that delays in transferring the legal ownership of properties negatively impacts the housing crisis.
In a submission to the Department of Justice last year it called for legal reforms and increased use of technology to improve efficiencies.
Many factors can cause these delays, including banks or financial institutions not releasing title deeds when money is owed on a mortgage, or cases where unregistered deeds are discovered. In such cases an application to register a property for the first time could take years and lead to increased conveyancing costs.
“While according to the Institute of Professional Auctioneers and Valuers (IPAV), the average time for completion of a property sale is 10.4 weeks, that number masks the fact many sales take far longer and in most serious cases the problems that the Law Society’s conveyancing committee of experts estimates can delay the completion of the process for up to five years,” the submission said.
“The society believes that delays in the conveyancing system are leading to a failure to complete transactions and is concerned about the adverse effects on the current residential housing crisis in Ireland.”
The IPAV said it can take between five and six weeks to eventually close a sale, bringing the average length of conveyancing on a property to about four months.
Law Society director general Mark Garrett said a lack of data and the paperbased conveyancing process mean it is unclear how often delays can continue for years. He said increased digitisation and legislative changes are needed to modernise systems used to buy and sell homes.
“We do receive quite a few anecdotes of such cases, and personally I have heard about a dozen. What is key is we don’t know how prevalent delays are because we don’t get that data from the Land Registry office,” Mr Garrett added.
“Changes of legislation are also needed to facilitate things like e-signatures, so there is no silver bullet here.
“One of the key things is the lack of data which digitisation can assist with, as well as bringing greater efficiency to the system. Nobody underestimates the challenge with digitisation as well. It’s a huge investment and will take time, that is why we are also looking at other areas.”
The Seller’s Legal Pack for Property Buyers Bill, currently before the Dáil, proposes that documents needed for a sale would be front-loaded in the process so they are available before homes come to market.
The Law Society said it agrees with the bill’s objectives but raised concerns about potential unintended consequences which could lead to additional costs for the seller which might be difficult to meet before a property is sold. It said compiling documents in advance of a sale also has the potential to delay a home coming on the market.
It recommended a move towards e-conveyancing, and reforming the Statutory Declarations and Registration of Title acts so forms and documents could be signed digitally to speed up some legal processes.