An IT entrepreneur in Wilmslow has set up an Internet business, called Assured Sale, to reduce the number of failed residential property transactions.
Founder Tim Price hopes his service will ensure the completion of a home sale by committing the seller and buyer to enter into a pre-exchange bond with funds held in a secure bank account – so if either party subsequently withdraws, the bond is automatically forfeited to the other party.
The cost of the bond to buyer and seller is tiered in line with the value of the property involved so for example, could range from £500 to £1,000 for a three-bedroom family home with a UK average price of £162,000. AssuredSale charges a fee, typically £150, to both the buyer and seller, in line with the bond.
The pre-exchange financial commitment is legally binding and the entire buying and selling process offers transparency because it can be seen online by all parties. A tracker function shows the real-time status of the transaction, following the process to exchange and completion. The funds will be held in an account with the Co-operative Bank until the sale is complete.
Tim Price worked for Reach Telecom, a start-up backed by Phones4U founder John Caudwell, helping to grow the business that became Caudwell Communications to 250,000 customers from zero in one year. His previous role was chief architect for the Hosting Business with FTSE 100 company Cable & Wireless. Price left in December 2010 and started to develop Assured Sale.
The Assured Sale team includes chief technical officer Daniel Pass, who Price has worked with for the past six years and all other members of the team are people Price has previously known. All of the team has shares in Assured Sale to help them achieve and share in results.
Price said: "Alarmingly, almost one third of all property sales – equating to about 200,000 transactions and costing a buyer or seller on average £1,000 – fail each and every year. This is mainly because the entire sale process is based purely on non-binding verbal offers that cause widespread gazumping, gazanging and gazundering.
"I decided to establish Assured Sale because I lost £2,000 and two months of wasted time when the owner of the home I wanted to buy pulled out.
"We're the first to market with this, so there's nothing else like us that can give early commitment at verbal offer. Pre-exchange agreements are available, but these are ad-hoc, expensive and not well known."
Price added: "There are many online tools from solicitors which handle the buyers' conveyancing progress, but our tool is for all parties to share and collaborate on from start to finish to help resolve issues.
"The house-buying process in England, Wales and Northern Ireland is stuck in its ways with customers seemingly resigned to how bad it is. In our research, everybody has, or knows somebody who has had a bad experience. It's not just about protecting the seller, because both seller and buyer stand to lose out financially if one pulls out on the other.
"AssuredSale addresses all of the key issues by being an online platform that adds transparency, financial protection and certainty for all parties involved."