High prices may be the biggest difficulty facing house-buyers, but the way in which the property market operates is causing unnecessary grief, particularly for less experienced buyers.
Most attention has focused on pre-auction guide prices where many auctioneers, particularly in Dublin, have undermined their professional credibility by quoting unrealistically low estimates in order to lure in as many potential buyers as possible on the day of the auction. Buyers in all parts of the country have complained about gazumping (where an offer for a house, initially accepted, is rejected in favour of a higher price) and lack of transparency in property dealings, exacerbated by the absence of any complaints mechanism in which they have confidence. It was against this background that Minister for Justice Michael McDowell last year set up a working group on the auctioneering profession which has now submitted its recommendations.
Mr McDowell should proceed with the statutory regulatory authority proposed by the group. Auctioneers themselves should welcome such an authority, since it has the potential to increase public confidence in the profession.
The working group has probably done as much as is practicable on guide prices, by proposing that the only figure an auctioneer can quote is an "advised minimum value" which is to be the agent's true opinion of the value of a property. Presumably, if an auctioneer is consistently shown to be producing figures which are as hopelessly wrong as many of today's guide prices, aggrieved parties could complain to the regulatory authority and sanctions could be imposed.
The recommendations point to a means by which the business of buying a house could be made easier and cheaper. From early 2007 onwards, people selling homes in Britain will have to provide a Home Information Pack containing evidence of title, planning consents, and - most interestingly - a home condition report based on a professional survey of the property. This could end the current situation where multiple potential buyers each have their own survey carried out on the same house, and where people often have several houses surveyed before they finally buy one. The working group recommends that the proposed new regulatory authority should review the case for mandatory seller packs. There is a strong case for modelling these on the British equivalent.
Part of the tension in house sales in Ireland is caused by extraordinary secrecy about property prices. Roll on the day when such details will be available on-line shortly after sales are registered, as in many other countries.