Property Purchase in Northern Ireland and England

Property purchase in Northern Ireland and England

Lynda Jayne Henry discusses some of the differences in buying a property in Northern Ireland and England.

Property Purchase

It is estimated that 10 billion Euros will be spent by Irish investors in the UK property sector this year. The basic principles of the conveyancing systems in Northern Ireland and England & Wales are the same. However, there are a number of significant differences.

Conveyancing

In both jurisdictions, the buyer becomes contractually bound on exchange, and ownership of the property is transferred to the buyer on completion. In England & Wales, searches are carried out by the buyer and the results are received before contracts are exchanged. Exchange would normally take place when the buyer's solicitor telephones the seller's solicitor to confirm that both solicitors are holding signed contracts and they would agree during the call to send the signed contracts by DX or post and the contract becomes binding at this stage. The buyer's solicitor would also forward a cheque in respect of the deposit and would submit the transfer document for approval together with requisitions on title. Both parties would usually sign the transfer and the transfer would be dated when the completion monies (which are usually telegraphically transferred) are received.

In Northern Ireland, the contract is usually signed by the buyer and sent to the seller's solicitor for signature. The seller's solicitor then returns the "Copy accepted" contract to the buyer's solicitor. The buyer's solicitor then drafts the transfer document and arranges for the completion monies to be sent by cheque or telegraphically transferred together with the transfer which has been executed by the buyer and an authorisation to cash the cheque.

Searches

In English conveyancing, the phrase "Caveat Emptor" ("buyer beware") is commonly used. It is the buyer's responsibility to carry out all of the necessary checks and investigations to ensure that the property has good title and that there is nothing that would be revealed by a search or inspection of the property that would adversely impact on the price or use of the property. This means that a buyer in England & Wales has wider access to a variety of searches such as searches of various utility companies and environmental searches. This is in contrast to Northern Ireland where the obligation is on the seller to provide property certificates and search results to the buyer together with the title information relating to the property.

Land Registry

In England & Wales, there has been a concerted effort to encourage land owners to register land. There are reduced fees for voluntary applications and specialists teams are available to deal with more complex first registration applications. It is a strategic aim of the Land Registry to have all of the land in England & Wales registered by 2012. This has resulted in a move towards a "paperless" system there. Copies of the entries on the title register can be obtained online by inserting the title number or by searching against the postal address of the property. There is no need to deposit Land Certificates to make changes to the title register as Land Certificates have been abolished. This has helped to speed up the conveyancing process in those jurisdictions.

Equitable Deposit

In Northern Ireland, depositing title deeds as security for bridging finance is common practice. There are currently proposals however, to abolish land certificates and move towards a "paperless" system. It will be interesting to see whether this will be dealt with by way of a restriction on the title as in England & Wales or alternatively, whether it will become a less popular form of security as has been the case in England.

This Article deals with only some of the differences between the English and Northern Irish systems of conveyancing. There are many more, however, in view of the proposed changes to the Northern Irish system and the drive towards electronic conveyancing it is likely in both jurisdictions that the differences between the systems will be significantly reduced in the next ten years.

Lynda Jayne Henry is a Solicitor in the firm's Commercial Property Department. She recently advised a large UK retailer on the English and Northern Irish property aspects of the acquisition of a home delivery business.

Lynda Jayne can be contacted at lyndajayne.henry@lestrangeandbrett.com

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