A local authority search is the most common search required when purchasing a property. It provides a cross-section of all the information held by the local council about your property, including:
- Local Land Charges Registrations (LLC1)
- Any planning permission granted, refused or pending
- Building control regulations
- Public use of the property’s land
- Highways information
- Road schemes near the property
- Rail schemes near the property
- Radon gas
- Whether the property is part of a conservation area
- Contaminated land
If your purchase is funded by a mortgage then, in most cases, you’ll need to get a local authority search as a condition of lending. In the same way that you wouldn’t be thrilled to discover your new home has subsidence problems, lenders need to know about anything that could impact the future value of the property.
There’s currently no obligation for cash buyers to get a local authority search done. However, it’s strongly recommended you order a search regardless of how you’re funding the purchase. After all, no one wants to move into a new home only to discover there’s a public right of way through the garden or the property is built on contaminated land.
What’s the Difference between Regulated and Official Searches?
An official regulated search or OLAS is compiled by the local land charges department at the council. A regulated search uses the same data but is compiled by a search agent or company (like PIC). The information contained in a local authority search is public record so, in theory, anyone could compile one but you need to know what you’re looking for and where to look.
The Case for Official Local Authority Searches
It was once the case that OLAS were the preferred version of local authority search for most mortgage lenders. And, although most now accept or even prefer a regulated search, there are still some lenders who insist upon buyers purchasing an official search.
The reasons for this go back a long way. Up until the early twenty-first century, there was a perception that regulated searches were unreliable or somehow ‘less valid’ than a search carried out by the council. The price also has something to do with this. OLAS are typically more expensive than regulated searches, so it was easy for many to assume that higher cost meant higher quality.
Alongside this, some felt OLAS offered greater protection should anything go wrong. The local authority is held liable for any losses incurred as a result of a search being completed incorrectly. And this led to the assumption that it would be far simpler to make a claim in the event of an error.
Thankfully, this mindset has changed and, as we’ll see, there are plenty of reasons why purchasing a regulated search may be the best fit for you.
The Case for Regulated
The rise of regulated searches can be traced back to one thing: local authority turnaround times. Regulated or (as they were formally known) personal searches first appeared on the scene back in the 1980s. At the time, some local authorities were taking weeks or even months to return a search, causing hundreds of aborted transactions.
Regulated searches have always been faster and more cost-effective, due to the smaller workloads managed by search agents and the fact they can focus on just compiling searches. However, in the past, they weren’t always as reliable as they could have been.
That’s no longer the case. The regulated search industry has its own trade association and regulatory body, COPSO. As a result, any report carrying the COPSO watermark comes with assurances that it’s of equal, if not higher, quality than any official search.
But it’s not just the quality of regulated searches that has improved. Most search companies now offer PI insurance as a standard bolt-on for every regulated search. For example, at PIC, all our regulated local authority search reports carry £5 million of insurance coverage. There’s no need for a protracted court case with the local authority or a battle to prove liability. Instead, you know you and your property are covered.
As we mentioned earlier, regulated searches also tend to be quicker than OLAS. Search agents aren’t trying to do several jobs at once and we can offer flexibility and prioritise urgent jobs in a way that councils can’t. What’s more, with a smaller workload and, in many cases, better resources a search agent can take the time to answer any questions you have and keep you updated every step of the way.
And then, there’s the cost. Depending on where you are in the country, your local authority could charge anywhere between 2 and 3 times as much as a search company. It’s worth pointing out that this is still exactly the same search, it just costs more money. Search agents, on the other hand, will usually charge a flat fee no matter where you are in the country, so there’s no financial penalty for living in an expensive local authority.
To draw some sort of conclusion, the search you choose will likely come down to your lender, but there are plenty of reasons to go regulated. If you do, always look to work with a reputable agent and keep an eye out for companies that are COPSO affiliated and offer insurance with each search.
If you’d like to know more about conveyancing searches, please get in touch, we’d love to hear from you.