Purchase and Sale

Question 1

What is the Estate Agents Act 1979

Answer 1

The act regulates estate agency work
Its purpose is to make sure that estate agents act in the best interests of their clients, and that both buyers and sellers are treated honestly, fairly, and promptly.
Disposal or acquisition of an interest in land

Question 2

What is the property misrepresentation act 1967

Answer 2

-False statement made which induces a party to purchase
- can sue for damages or have contract re-scinded

Question 3

What is market rent

Answer 3

leasor and lesee

Question 4

What is an occupational lease

Answer 4

Lease which is occupied

Question 5

What is covenant strength

Answer 5

tenants ability to pay rent
-good track record
-can check strength via Dunn and Bradstreet

Question 6

Talk me through the purchase you undertook at Netherton

Answer 6

-Submitted a bid for a council owned site
-Pior to this i undertook my due dilligence
–Nothing stood out in the title - no exisiting Rights of Way, restrictions
-Sought planning advise and desktop surveys to see if a scheme could work here
-

Question 7

What are pre-bid clarifications and why did you seek this at Netherton

Answer 7

-To seek clarifications on building condition as Lidl were required to demolish

Question 8

You mention bids were via informal tender. What are the benefits of informal tender for a client.

Answer 8

-Can have more than 1 round of best bids
-if you receive a bid late you can report to client and ask for instructions

Question 9

Talk me through the disposal at Great Homer Street

Answer 9

Off-market sale to Tim Hortons via private treaty as the offer was so strong
(private treaty?)

Question 10

What is private treaty

Answer 10

Most common method of sale
Property is marketed openly, including marketing particulars
Allows a potential purchaser to “treat” with the seller
Recommendations of offers are made to seller via agent
Typical info to provide includes proof of funding

-Seller not obliged to sell
-flexible and inexpensive
-Advertising can be limited or extensive to suit clients requirements

Disadvantages
-Late withdrawals and associated abortive costs

Tim Hortons on 15 year FRI leae
tenant only break at 10th yr
87k
9 months rent free

Question 11

Talk me through the purchase you undertook at Moreton

Answer 11

-JV between Wirral Growth Company and Council
-Masterplan had changed during legals which naturally altered contract

Question 12

How and why did the contract alter at Moreton

Answer 12

-Masterplan changed as a result of public consultation from Lidl foodstore and care home to extension of library and residential properties.
- AFL altered Overflow Car Park
-RoW
Contractor Compound
-Boundary treatments
-Stopping up order

Question 13

Talk me through the sale of land at Tiverton

Answer 13

Informal tender
Data room was set up
Offers received
And proceeded with highest unconditional bidder

Question 14

What are the different methods of sale

Answer 14

Private treaty- target purchasers, negotiate
Formal tender - closed bids, can go straight to contract on best bids date
Informal Tender - best bids, can have more than 1 best bids date. Can receive late offers
Auction - hammer falls its binding. Must have deposit on the day.

Question 15

Pros and cons of selling at auction

Answer 15

-quick
-Transparent (used for mortgage repossessions)
BUT
-higher fees 2..5%
-and failure to sell can blight property

Question 16

What is sole agency

Answer 16

Single agent is appointed to market a property
No sale, no fee

Question 17

What is sole selling rights

Answer 17

Same as sole agency.
But if you find your own buyer, then you will still have to pay the agent

Question 18

What are the 3 types of agency

Answer 18

Sole
Joint-shared fee on a pre-agreed basis
Multiple agency - winner takes all

Question 19

What are the stamp duty bands

Answer 19

Commercial
Up to £150,000 = 0%
£150-250 = 2%
Above £250 = 5%

Question 20

What is VAT

Answer 20

Charge on the sale of all goods and services

Question 21

What does the Property Misdescriptions Act 1991 cover

Answer 21

Everything

Question 22

What is the punishment for a breach under the Estate Agents Act 1979

Answer 22

Can prohibit an agent from practicing
Or issue warning notice

Question 23

What is without prejudice?

Answer 23

Information/evident Cannot be used in a court of law

Question 24

What is subject to contract

Answer 24

Neither party bound unless a formal contract is made

Question 25

What is an overage

Answer 25

seller will be paid extra by the buyer if the specified events happen within a specified timescale e.g. if land sold is later developed and therefore the value increases significantly.

Question 26

What is memorandum of sale

Answer 26

heads of Terms

Question 27

What do you do if you have an unregistered titile

Answer 27

Get defective title insurance

Question 28

What was included in your agreed heads of terms at Netherton

Answer 28

-vendors details, solicitor details
-Conditions
-Timings
-Demise
-Price
-Date

Question 29

What is a right of way

Answer 29

A legal right to pass along a specific route or ground of a property belonging to another
aka easement

Question 30

What was your role in sale at Tiverton and what did you come across

Answer 30

• instructing agent
• reviewing sale brochure
  -setting BAFO deadlines
  -instructing and liasing with solicitors

-Came across a range of bids

Question 31

Why did you chose informal tender

Answer 31

-price is not the only consideration as lidl want to protect their own interests
-still able to test market
-flexibility

Question 32

What is a phase 1 report

Answer 32

Phase 1 Environmental Assessments provide detailed information about the current state of an environment within the proposed area.

Question 33

What is a phase 2 report

Answer 33

Phase 2 Environmental Assessments involve more rigorous investigation into potential environmental contaminants or hazards on site

Question 34

Where can you find information on a right of way

Answer 34

-public records shown on definitive maps
-highway authority has a statutory duty to maintain
-rights of access are included in your title deeds

Question 35

What are the different typs of easements

Answer 35

Express grant - in title deeds
Implied - rather than in deeds, its implied
Prescription - using land over 20 years