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HIGH-END LONDON PROPERTY IN HIGH DEMAND – GENERATING A DIVIDE BETWEEN CASH BUYERS AND BORROWERS
Higher inflation rates, interest and rents, alongside a decline in average real-term earnings, have increased housing costs for most people. But amid the housing crisis, cash buyers appear to be among the groups thriving most.
Cash buyers are individuals who can finance the purchase of property without a mortgage or having to sell their home. These individuals must have the financial capabilities to purchase the property when they make the offer.
Cash buyers currently purchase a larger share of London’s most affluent homes since they can avoid booming borrowing rates. This has fuelled resilience in the UK capital’s high-end housing market.
Recently, borrowers were hit with a 6% average five-year fixed-rate UK mortgage cost for the first time since November 2022. This increase arose from the Bank of England’s constant interest rate hikes to manage high inflation.
Research conducted by Savills has outlined the contrast between central London homes (where cash buyers are most prevalent) and suburban areas (where homes requiring mortgages are more impacted by rate rises).
Property prices above £5 million remained flat on an annual basis in the second quarter of 2023, while houses worth between £500,000 and £1 million dropped 2.1%, and the under £500,000 market fell by 2.5%. This creates a concern that wealthy overseas buyers seek to purchase properties at the expense of working Londoners.
Legal impact for cash buyers
Cash purchases are a fee generator for law firms, the same as mortgage-back purchases. Cash buyers need property lawyers to act as draughtsmen to ensure favourable contract terms. In addition, they will give legal advice, undertake prerequisite searches such as Local Authority and Land Registry searches, and manage monies as per SRA Guidelines.
Cash buyers will not, however, require legal advice on a mortgage as they can purchase the property without needing to take out a mortgage.
Legal impact on borrowers
For borrowers, the soaring interest rates may force those struggling to sell their homes, settle their mortgages, and move to more affordable homes. Property lawyers would therefore be involved in property sale transactions, thus ensuring properties are sold to potential buyers at the best prices possible.
The advocate would also need to undertake tasks such as distributing legal contracts, obtaining title deeds, negotiating with the buyer’s legal representatives, approving the deed of transfer, and completing all other steps required for sale completion.
Should borrowers opt to sell their homes to purchase more affordable ones, they will need additional legal advice for buying the new property and potentially procuring a new mortgage.
Article written by Tina Khorram
A Hard-Fought Victory: The Triumphant Struggle of Dáithí Mac Gabhann and His Family in Transforming Northern Ireland’s Organ Donation Laws
The tireless campaigning of a six-year-old boy named Dáithí Mac Gabhann and his family has sparked a significant reform of organ donation laws in Northern Ireland. Dáithí, who has been on the heart transplant waiting list since 2018, has become an inspiring force in advocating for change.
Dáithí’s and his family’s persistent efforts have centred around urging lawmakers in Northern Ireland to transition the organ donation system to an opt-out approach, with the aim of boosting donor numbers.
Needless to say, it was not an easy battle to fight. However, with resilience and courage, Dáithí’s arduous struggle successfully transformed Northern Ireland’s organ donation laws to match Wales, England, and Scotland’s soft opt-out organ donation laws.
The Origins of Dáithí’s Law
In a remarkable turn of events, the relentless campaign led by Dáithí and his family reached a momentous milestone in February 2022. Assembly members at Stormont paid homage to their tireless dedication by officially naming the Organ and Tissue Donation (Deemed Consent) Bill after young Dáithí himself. This symbolised and celebrated a pivotal moment in the family’s journey towards reshaping organ donation laws in Northern Ireland.
Nevertheless, it is essential to acknowledge that Dáithí ‘s impassioned advocacy for an opt-out organ donation system was not the first time such discussions occurred within the Northern Ireland Assembly. As early as 2012, the topic had already been subject to deliberations and debates.
During that time, Jo-Anne Dobson, an esteemed Assembly member representing the Ulster Unionist Party, took the initiative by introducing a private member’s Bill that centred around the pressing matter of organ donation. However, this suggestion was rejected by Stormont’s Health Committee in 2016.
Thankfully, through Dáithí and his family’s campaigning, this topic was re-introduced two years later. Interestingly, the new Bill was supported by all of Stormont’s parties except some members of the Democratic Unionist Party. That said, in June 2021, DUP’s Paul Given gave the all-green and approved this legislation to proceed to the Assembly so it could pass into law. In support of this, Health Minister Robin Swann said about 180 lives could be changed yearly by overhauling the rules.
However, one great difficulty remained as an obstacle for the Mac Gabhann family- although the law passed its final stage in the Assembly in February 2022, secondary legislation is mandatory to specify which organs and tissues are covered under the opt-out system.
In its absence, the law remains inoperative.
A sense of delay?
Unfortunately, in the wake of significant political shifts in Northern Ireland during the month the law passed its final stage, Dáithí’s law remained at a stand-still. As a result, the Mac Gabhann family contemplated legal recourse due to the consequential delay in this significant issue. Thus, the DUP advocated for handling the legislation on organ donation at Westminster instead. As a result, it was duly carried out.
Unsurprisingly, another difficulty in the passing of the legislation was presented. The Bill’s narrow scope created concerns about whether the House of Commons Speaker would accept the amendment. Therefore, the Mac Gabhanns pressed for Prime Minster Rishi Sunak and the Secretary of State Chris Heaton-Harris to pass the enabling legislation at Westminster.
DUP MP Carla Lockhart called on the Secretary of State to progress the necessary secondary legislation provisions and claimed that “this legislation has the potential to transform the lives of so many people requiring a transplant procedure.”
With this in mind, the government amended the Westminster Bill, with Mr Heaton-Harris saying the government’s intervention on the matter was “exceptional” given just how important this issue is.
Before the implementation of Dáithí’s Law, organ donation procedures in Northern Ireland were heavily restricted. Donations would only proceed if a person has given their express consent, typically by registering on the NHS Organ Donor Register or through discussing potential wishes with their families.
However, the enactment of this remarkable law brought forward a transformative change. Under its provisions, all adults in Northern Ireland would be presumed potential organ donors upon their death unless they had explicitly expressed their opposition.
According to statistics released by the Public Health Agency in 2022, a staggering 90% of people in Northern Ireland support organ donation, yet only half of them have registered as organ donors. Additionally, the report highlighted the sobering fact that approximately 10 to 15 individuals lose their lives each year while awaiting a life-saving transplant.
Dáithí’s Law aims to bridge this gap by creating a system where the default assumption is one of organ donation, ensuring that more lives could be saved through increased donor availability.
The enactment of this legislation reflected the widespread support for organ donation in Northern Ireland and serves as a beacon of hope for those awaiting a second chance at life through organ transplantation.
Article written by Shruti Viththiananthan