Property lawyers out there?

[David_D]

Any advice gratefully received!

I put down a "reservation fee" yesterday on a residential property. Today they call and say, sorry, price has gone up 7.6%!!

Reservation form says "subject to contract" which I assume means the 'undertaking' to sell at the originally quoted price is meaningless.

This is in England, of course!

Cheers!

[Kingstepper]

If it is meaningless, accept the increase and pull out yourself before contract.

[David_D]

If it is meaningless, accept the increase and pull out yourself before contract.

Indeed! It's completion some months off on a new development. Just a bit sour taste getting "stung" hours after reserving. Looks like it's just English residential property law as we know and love it!

Unless anyone knows better?

[thegreatdogwood]

It means that it is non-binding up to the point that you physically enter into a formal contract.

All you can do is contact the most senior person in the organisation you were buying from and ask him to honour what was agreed.

If he chooses not to then I'd take it as a message that I wouldn't want to deal with them anyway.

[topcat666]

If you stay with them at the increased price,what's to stop them doing it again before an exchange of contracts?
Maybe this link could be useful if the builder has subscribed to this "code":http://www.consumercodefornewhomes.c...ode/4591786489
Reputable builders do not normally do this;if word gets out then it damages their reputation.

[JonRA]

It means that it is non-binding up to the point that you physically enter into a formal contract.

All you can do is contact the most senior person in the organisation you were buying from and ask him to honour what was agreed.

If he chooses not to then I'd take it as a message that I wouldn't want to deal with them anyway.

This what I'd do - if the company you want to deal with doesn't conform with your own values, think really carefully whether you want to deal with them. It's not just completing, you could spend the next two years trying to get them to sort out snagging issues - and some companies are not what you would want after they've had your money...

[Rodder]

What's the point of a deposit if the seller can simply increase the price to and effectively cancel the contract?

If you wanted to get out and they didn't want to, could you simply say I'm now offering 7.6% less, if you don't accept refund me.

Seems pointless to pay a deposit

[David_D]

Thanks all. Much appreciated.

If you stay with them at the increased price,what's to stop them doing it again before an exchange of contracts?
Maybe this link could be useful if the builder has subscribed to this "code":http://www.consumercodefornewhomes.c...ode/4591786489
Reputable builders do not normally do this;if word gets out then it damages their reputation.

Thanks. Very useful indeed. The reservation form refers to the Code but I wasn't given a hard or a soft copy. It makes interesting reading and, for what it's worth, appears to put them (or rather the agent) squarely in the wrong.

EDIT: Apparently, there is more than one "code" and this developer isn't in that one! It is in this: http://www.consumercode.co.uk so I need to see what that says! Thought I was getting somewhere!

It means that it is non-binding up to the point that you physically enter into a formal contract.

All you can do is contact the most senior person in the organisation you were buying from and ask him to honour what was agreed.

If he chooses not to then I'd take it as a message that I wouldn't want to deal with them anyway.

I hadn't appreciated the full scope of the Consumer Code topcat666 highlighted. I'd wrongly assumed it was just the usual (developer) "gazumping" permitted under English law.

This what I'd do - if the company you want to deal with doesn't conform with your own values, think really carefully whether you want to deal with them. It's not just completing, you could spend the next two years trying to get them to sort out snagging issues - and some companies are not what you would want after they've had your money...

Absolutely. If they are playing fast and loose at this stage ....

What's the point of a deposit if the seller can simply increase the price to and effectively cancel the contract?

If you wanted to get out and they didn't want to, could you simply say I'm now offering 7.6% less, if you don't accept refund me.

Seems pointless to pay a deposit

Agreed. It's not a deposit strictly but rather a reservation fee. The terms of a reservation should meet the standards in the Code. It appears to me that their actions haven't.