Extended feature | Professor Stewart Brymer of the University of Dundee and the Home Buying & Selling Group looks at how far conveyancing has come – and where it may go next
January is always a time for looking forward. My purpose in this article is no different, but I wish to begin by looking back and considering what we have got in the UK – and how lucky we are to have it.
Registration of title is often described as the third step in the three-part conveyancing process: contract, due diligence on title and other matters, and registration of the purchaser’s title and other documentation. In many respects, it is the most important step in the process as, without it, owners and secured lenders would not have the security that they require having invested in property.
The history of registration of title is a rich one in the UK – with Scotland having the longest continuously running Property Register in the form of the General Register of Sasines (“Sasines”).
Sasines was the first national land register in the world. The first entry therein was an annual rent right to Robert Pitcairn, a tailor in the Canongate, secured on a property at Pitfirrane, Fife. Sasines is still operational but is largely being replaced by the Land Register of Scotland which is maintained by the Keeper of the Registers of Scotland (RoS).
Unlike Sasines, which was a register of deeds (and as a consequence highly opaque except to conveyancers), the Land Register of Scotland is a digital, map-based register. As is the case with HM Land Registry (HMLR), it can be searched online and uses the Ordnance Survey map as its base map.
However as mentioned above, the purpose of this article is not historical but rather forward-looking as the digital age advances around us. We are extremely fortunate in the UK to have in HMLR and RoS, two of the world’s leading land registries, who are developing their digital transformation programmes apace. As such, it is suggested that there is no need for us to consider adopting another portal or platform (call it what you may) through which the registration process can be facilitated as to do so will simply add to the cost for consumers.
The current situation
As been said many times before, the pandemic was a “game-changer” as far as registration and other processes in society at large and in the home-moving process in particular. We all had to adapt and it is to the credit of HMLR and RoS for the way they adapted in order to guarantee security of title for citizens and conveyancers alike.
We have probably been propelled a number of years further ahead of where the HMLR/RoS digital transformation programmes would otherwise have been. The question is, however, what we do to build on that quantum leap forward?
The good news is that HMLR and RoS are continuing to develop with moves being planned around Qualified Electronic Signatures, digital identity, and further developments to digital submission and preparation of digital deeds.
Indeed, they deserve credit for their work in engaging with Government on the digitisation of other aspects of life e.g. Digital Identity/Safe Harbour and driving legislative change alongside the digital change that is necessary. In Scotland, RoS already processes payments of Land and Buildings Transaction Tax on behalf of Revenue Scotland thus making it a “one-stop shop” in that regard. The same can be done with SDLT – and I wish we still had SDLT in Scotland rather than LBTT!
Other developments
The past few years has also seen a range of new initiatives coming from forward-thinking fintech and proptech companies.
A number of these initiatives have provided much-needed solutions to problem areas and the issue now is how we integrate them into conveyancing and registration of title practice in order that we can all benefit from a full digital service.
One such initiative has been the ability to learn from the experience in Australia through the vision of those behind Property Exchange Australia (PEXA). PEXA has travelled far in a relatively short period of time since its launch. There can be no doubt that such positive progress has been a direct result of the extensive collaboration which has existed among stakeholders in the process in Australia. PEXA has launched in the UK and recently announced its first remortgage transaction and plans to do more in that area and beyond.
Their ambition is a credit to them and, in particular, to those who launched PEXA just over a decade ago.
Before we rush to look to copy what they have done, however, we should stand back and take an objective assessment of their Australian platform and how it works before considering whether we are comparing “apples with apples”. In other words, what works in Australia might not work in the UK without requiring extensive modification. Furthermore, we may already have the tools to build something just as good or better.
PEXA in Australia benefited from a particular set of circumstances (they were still settling transactions in physical dealing rooms where they exchanged cheques). There was a real need to change and the lenders in particular drove that change by working in collaboration with the Land Registries.
The result was the development of an integrated payment and registration process channelled through the PEXA platform which led to a fairly rapid expansion and broad acceptance that it was the way to improve the Australian home-moving process. Having four of the main lenders and the Land Registries as shareholders also helped the vision become a reality.
The next logical step for them was therefore to look at international opportunities. The UK was an obvious place to start and there is no doubt that we can learn from the Australian experience. Need we go any further than undertaking a comparative analysis, however? It is suggested that we do not.
In HMLR and RoS, we already have effective national portals who are working in a collaborative manner. They are, and always will be, national institutions. By describing them in that way I do not wish to shower them with faint praise.
On the contrary, we should give credit where credit is due. They have spearheaded change in registration of title and practice and should be supported in so doing as they advance their respective digital transformation programmes. They have the trust and support of conveyancers and the public generally and there is no need for another platform to be created to sit alongside the registries in a form of satellite operation. We already pay to process registration through HMLR and RoS and there is no need to pay an externally owned platform to do so in the future.
In short, why adopt a foreign system to act as a gateway to HMLR and RoS when we can develop our own? A satellite platform will have fees associated with it in order to process transactions in the form of a link to the land registries. Such fees will require to be paid by the conveyancer and passed onto the consumer. How do we sell that in an already fee-conscious market? Indeed, was that not what led in part to the downfall of VEYO in 2015?
There is no doubt that PEXA’s payment and registration solution is very beneficial and works well in Australia. Let’s not forget, however, that we are much further down the road towards that ourselves here in the UK. Digital submission is a reality and further enhancements along that road will follow such that we will get to the stage when all transactions are effectively processed through secure links to HMLR and RoS. Synchronised payment solutions are also being developed. Remember that it was only just over ten years ago that we moved to contactless payments in the UK.
Is it really so difficult to integrate a suitable system into the registration process without having to adopt a solution owned by external shareholders?
All in all, the digital transformation programmes of our Land Registries will benefit the practice of conveyancing and registration of title and, by so doing, will have a positive outcome for consumers. That is as it should be.
Over time, the practice of conveyancing will move onto the land registry systems through choice and, if required, by mandate. This is not a hypothetical pipe dream of an elderly conveyancer nor is it xenophobic in its approach.
On the contrary, the landscape is changing fast and I believe that we can take the next steps without having to adopt a foreign system. The land registries know how the market works in the UK and hold the keys to the gateway and we should support them in their efforts. That is as it should be. The system in the UK is not as broken or as clunky as the Australian system was.
Yes, there are issues to be sorted, but we are making progress to sort them through the Home Buying & Selling Group and other initiatives. We need to be bold and back “Made in Britain”. To do otherwise is to allow a Trojan Horse to be brought into our national land registries. Remember what happened to the citizens of Troy!
Article written Professor Stewart Brymer of the University of Dundee and the Scottish Conveyancers Forum. He is a participant in the Home Buying & Selling Group – https://homebuyingandsellinggroup.co.uk/
The views expressed in this article are the personal views of the author.
