Who Is Liable For Property Damage Between Exchange And Completion?
Property damage is anyone’s worst nightmare, especially so close to Christmas. For those that are in the process of purchasing a property and have already exchanged contracts it is an extra concern as they do not legally own the property yet, but cannot pull out of the sale either.
Once contracts are exchanged for the sale of a property it then becomes a shady area as to who is responsible for any repairs. Most solicitors would advise that anyone purchasing a property should take out buildings insurance to cover from the date of exchange, even if the sellers do still have their own policy. This is because once contracts have exchanged you are legally obligated to complete on the sale, regardless of any damage that occurs to the building between exchange and completion. This means if you haven’t taken out insurance and the roof is destroyed by a storm between exchange and completion, you will have to buy the property and face the costs of repairing it yourself.
If you haven’t taken out insurance you can hope that the sellers have still got insurance, but it will be unlikely that they will want to face the hike in their insurance premiums that would result from them claiming for damage to a property that they no longer own. The safest bet is to always take out insurance to cover you from exchange of contracts, even though you do not technically own the property yet.
When you do complete on the sale here are some tips for helping your property weather the storm:
- Establish an evacuation plan
- Ensure gutters and drains are clear, which will allow water can drain effectively
- Place valuable/irreplaceable items upstairs to limit flood damage
- Secure fences and bring garden furniture and washing lines etc. inside
- Keep insurer’s contact details to hand as it is important to report any damage as soon as possible.
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