The world of conveyancing is in line for a massive shake-up that is predicted to see “one-third of all conveyancing businesses disappear”.
Solicitors and licensed conveyancers have been big winners of the housing boom, but are now in the firing line, as the new age of technology threatens to change their bread and butter business.
Both Tamworth realtor Richie Thornton and Principal of Alliance Conveyancing and Bromhead Legal Greg McGuinness have compared the incoming upheaval as the biggest industry disruptor since Uber revolutionised the transport industry.
The Property Exchange Australia e-conveyancing platform (PEXA) was rolled out in NSW over two years ago, and will soon be the only method used to settle property transactions.
The digital exchange has the capacity to replace most Australian paper-based property title transfers, reduce conveyancing times and costs, and bring property buyers and sellers, conveyancers, banks and title registry offices onto a single unified system.
“It has been mandated by the government that all transactions be settled through PEXA by a date in 2019,” Mr McGuinness said.
“Electronic conveyancing is imminent and part of the complete digitisation of the conveyancing process. It will definitely cause an upheaval in the industry – as far as I can determine about a third of all conveyancing businesses will disappear.”
“I can see a time when it will be instantaneous – same day – but I would never recommend that.”
PEXA chief executive Marcus Price said “because there were no geographic barriers or need to physically lodge paper documents with a titles office, settlements will come down to five to seven days from the traditional 60 to 90-day period”.
Mr Thornton has never been able to understand why it takes so long to settle, which can be an anxious wait for both parties, although changes, such as the 0.25 per cent deposit system are already addressing that issue.
That system enables the buyer to pay a 0.25 per cent deposit that effectively takes the house off the market for a five day period, effectively protecting the buyer from getting gazumped.
“80 per cent of residential deals are straight-forward and people under-estimate the anxiety of waiting six weeks for settlement,” Mr Thornton said. “The new system and the online service will totally revolutionise the industry.”