Proposition 52K1273

Projet de loi modifiant le Code judiciaire en ce qui concerne la vente publique d'immeubles.

General information ¶

Authors

CD&V Katrien Schryvers, Raf Terwingen
N-VA Els De Rammelaere, Sarah Smeyers

Submission date

June 23, 2008

Official page

Visit

Status

Adopted

Requirement

Simple

Subjects

transfer of property real property sale

Voting ¶

Voted to adopt

CD&V Vooruit LE PS | SP Open Vld N-VA LDD MR FN VB

Abstained from voting

Groen Ecolo

Contact form ¶

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Discussion ¶

April 2, 2009 | Plenary session (Chamber of representatives)

Full source

I refer to the written report that was communicated to the Chamber.

Mr. Speaker, dear colleagues, I would like to start with a message from Het Belang van Limburg of 24 October 2007 entitled "Notaries want to sell a house in one sitting day". Honesty commands me to say that this article was the source of inspiration for my bill that is now for approval.

The article states: “We need to go back to one sitting day for the public sale of a house or apartment. Now no one will appear before the first day of purchase. As a result, notaries are wasting their time and the buyer must pay all additional costs of a second day of sale,” said notary Koen Vermeulen, chairman of the Limburg Commission for Public Sales. Therefore, it is clear that this proposal did not come out simply. It responds to the question of notaries in the field who have faced these difficulties.

The difficulties lie in the fact that most people who want to buy a property today think that in public sales one must legally have two buying days or sitting days. However, this is not true. The principle of one sitting day was and is in some provinces, I think of Limburg, always the principle. However, the principle of the only day of sale was wasted over time. Nowadays, everyone assumes that there will be a second purchase day. There is nothing wrong with that in itself, but the misunderstanding results in practice to unpleasant consequences.

A first annoying consequence is that people who want to buy a property rarely appear on the first sitting day. They do not take the effort to come because they assume that a second sitting day will be automatically organized. In practice, the first day is a lost day. There are hardly orders. In order to ⁇ a good selling price, in practice, a second sitting day is always needed. Who else does the trouble to be present on the first day of the sitting, if one often needs to take a day’s leave? This is useless, both for the seller and for the buyer.

A second unpleasant consequence is the actual increase in costs. Not only does the cost of the allocation price increase by a second day of sitting, usually by 1%, but also the announcement, the publication of a second day of sitting in the newspapers and the mandatory publication of new posters and advertisements on real estate websites hunt the cost in the height. These additional costs can be between 2,000 and 2,500 euros. Thus, these are unpleasant consequences that are not necessary.

The present proposal therefore has the ambition to help the world out of those outlined difficulties and to break the circular reasoning that now exists in the head of the buyers. The bill provides a response to the high cost and waste of time that the current procedure entails. With a lustless show, which is the first sitting day today, I think no one is served. The new system makes public sales for the notary, the seller and the buyer more efficient, faster and cheaper. The bill is a perfect example of administrative simplification in practice.

I would like to outline to my colleagues how the proposal manages to overcome the difficulties on the ground. As a result of the adoption of the bill, in the future, in principle, only one sitting day will be held. In order to keep all opportunities cool at the best price, the right to a higher bid is ⁇ ined. If a higher bid is issued within fifteen days after the first sitting day – in writing to the notary – then automatically follows another second sale day on which the sale is closed finally. A second sitting day with a higher price associated with it is still possible in the future, but today in practice it often comes down to a third sitting day. The latter will no longer be the case.

The proposal also introduces a premium system, which is different from the current premium system. The bill introduces a system of premiums to encourage biders to make an offer. The proposal provides for a fixed price that can be set by the notary and which will be an estimated real value of sale. The first to offer that amount receives a premium of 1% on the offered amount, provided that he is the final acquirer of the property. Even in the case of a sale without a set price, a notary may award a premium to the bidder with the highest bid on the first sitting day, provided that he is the final acquirer of the property. This discourages the current phenomenon of systematic uplifting of the purchase price by prize hunters or popularly called earning pickers. Those prize hunters or earnings pickers often act as so-called buyers; they often act for their own profit. By counteracting this speculation, the approval of the proposal will result in a fairer and more correct pricing.

This is, in short, the content of my proposal. I believe that the proposed amendments only provide benefits for all stakeholders. Removing the second sitting day is, as mentioned, cost and time saving. The candidate buyers should not only sacrifice just one holiday day instead of two, also for the seller everything will go faster. In the current state of affairs, there should be fourteen days between the first and the second day of the seat, followed usually by a right of higher bid of fourteen days and a third day of the seat. With the current system of consecutive purchase days, it will soon take a month to two months for a property to be sold.

Finally, my colleagues, here is this. Per ⁇ the difficult thing about this proposal is the mentality change that the abolition of the second sitting day entails. This change of mindset will also be necessary for notaries. A years-long custom is being modified but I point out that this is also at the request of the Federation of Notaries. They were in favour of this amendment from the beginning and I have been able to work well with them in editing this proposal. Thus, the objectives of my proposal are time and cost savings. In a time of economic crisis and falling property prices, this seems to me worth your support.

Mr. Speaker, Mr. Minister, dear colleagues, as regards the bill on the public sale of buildings, the MR group would like to make known that, like the authors of the proposal, it is in favor of the establishment of a single session because such a system is simpler, cheaper, faster and more transparent and protects the consumer. Thanks to the new system, the buyer will no longer have any interest in waiting for the second session to make an offer. In order to encourage potential tenderers to make an offer, with the prospect of acquiring the building for a good price, the text empowers the notary to optionally determine a starting price. The proposal does not require the fixation of such a price because the value of certain buildings is sometimes difficult to estimate in practice and therefore it is uncomfortable to fix a starting price for these goods.

When the first tenderer makes an offer equal to or greater than the starting price and the property is definitively awarded to him, he receives a discount on the price equivalent to 1% of the amount of his offer. The reduction in price shall be acquired from the tenderer only insofar as the property is definitively awarded to him and that the tenderer who made this price offer is effectively the final tenderer, either at the end of the single sale session or at the end of the possible second surcharge session.

The objective of the starting price system with compensation is to encourage prospective buyers to bid quickly in such a way as to obtain a reasonable price from the outset. In the absence of a first bid, the notary tries to raise a decreasing bid. In fact, the tenderers may hope or speculate that the starting price will not be offered but that the price will fall by decreasing auction. This speculation depends on the starting price: if it is too high, it can discourage any bidder from making a first bid and the starting price will not be reached. It doesn’t have to be too low in order to get a good price from the start.

As Ms. Smeyers recalled, during committee discussions, the authors of the bill submitted an amendment to their original text to extend this premium system to tenderers who are not final contractors of the building. In this case, it was 1% of the prize set by the notary or 1% of the highest prize offered at the end of the hearing if the notary has not made a prize set. This system has raised many fears and criticisms, among others in our group.

A fear of bonus hunters, i.e. professionals of the first offer present only to touch the bonus without any intention to acquire the property put on sale.

A fear of collusion between sellers and third parties to raise the auctions.

- The appearance, in the costs, of a premium which is paid at the expense of the mass: it is a bit heavy for the creditor of the seller to be supplanted by a newcomer in the recovery of the amounts owed to them. Indeed, in the case of a debt of the mass, it will be paid by priority over the sale price obtained in fine, before the creditors or, at least, those who do not have a special privilege whose debts are in the mass, thus subject to competition.

In order to be able to unlock this situation, three new amendments were then drafted by us, in collaboration with the authors of the proposal, thus enabling the desired objectives, on the one hand, and avoiding the raised bars, on the other.

Here I will cite three examples of the compromises achieved.

The first is the removal of the second compulsory public sale session; therefore, there is only one compulsory session. However, we have only consented to this deletion by ⁇ ining the possibility of over-the-counter and related advertising. If this possibility occurs, it will result in a second tendering session.

The second: the faculty for the notary to fix a reasonable starting price. Indeed, if one wants to really make a single auction effective, one must give itself every chance to get a reasonable price for the buyer and for the seller. This prevents people from speculating on a very low selling price.

However, it was important for us to still maintain some freedom for the buyer to succeed in a good deal. That is why we have agreed on the possibility to conduct decreasing auctions. If no one offers the starting price, which is perfectly everyone’s right, the buyer can hope to buy the property for a price lower than the reasonable estimated price and thus make a good deal through decreasing auctions.

The third: the award of a premium to the person who makes a first reasonable offer, both in the case where the notary has fixed a starting price and in the case where such a price is not fixed. Such a measure is effectively capable of allowing the property to sell itself at a reasonable price from the single session by justifying the reasonable offers.

In the event of a pricing, this premium shall be equal to 1% of the first offer issued by the first person who made an offer equivalent to or greater than the amount of the pricing. In the event that the notary has not fixed a starting price, the premium shall be equal to 1% of the highest offer at the end of the single auction session. This premium shall be granted to the acquirer only if he is the final tenderer or the final acquirer of the property at the end of the single auction session and the second session following a possible surplus auction.

This point was primary for us, because we absolutely wanted to avoid giving such a bonus to someone who does not want to acquire the property permanently, or to potential bonus hunters.

In conclusion, our group believes that the text adopted in commission is a good balance between the interests of the various parties present: sellers who obtain the guarantee that their goods will depart at a reasonable price, buyers who can still speculate on decreasing auctions and who still have a possibility of surcharge in addition to the premium and, finally, the potential creditors of the seller who benefit from the same guarantees that the property will be sold at a reasonable price covering the extent of their platform and who are no longer burdened with a debt towards a third party not the final acquirer.

Before finishing, let me highlight here the excellent work of our colleagues Terwingen and Smeyers, collaborators of the various groups and, of course, of the Federation of Notaries.

I thank you for your attention.

Mr. Speaker, Mr. Minister, Colleagues, it has already been said here: the second sitting day at a public sale was effectively intended to guarantee a better price when selling a property. In practice, however, this did not prove to be the case. I think it is therefore a good thing that the systematic organisation of a second day of sitting, of a second day of sale, is abolished with the present proposal. After all, in practice it has been shown that that second day of sitting involves a lot of costs without effectively guaranteeing a better price.

I myself, along with my colleagues from Open Vld, support a clear, uniform legislation. That is why we voted in the committee for this proposal and supported the applicants.

I am also grateful to the colleagues for adopting an amendment that I myself submitted during the discussion in the committee to make the different systems of public sale even more uniform, even better than was achieved in the first version of the proposal.

Even today, in the case of a voluntary public sale, there is still the possibility of not allocating the good and thus not allowing the sale to continue. In the case of a forced public sale, this possibility does not exist, even when it turns out that the price is so low that even the costs of the sale cannot be covered. The amendment adopted in the committee fully equalises forced public sale with voluntary public sale, so that in all public sales of real estate it can be decided not to use the higher bid.

A coherent, clear legislation is something that is repeatedly asked of us. We have been repeatedly reminded of the necessary attention and care in the preparation of legislation. I think the present proposal meets that. It has had some feet in the ground, but I thank the colleagues at least all, across the groups, for the good cooperation during the committee meeting.

Thank you, Mrs. Van Cauter, also for the courtesy.

I notice enthusiasm and unanimity among the previous speakers, but it has still had some feet in the ground before the committee had landed. Our group abstained and we will continue to do so today.

Two major changes were made.

First, the abolition of the second sitting day. In a public sale, especially in a forced public sale, it is important to ⁇ the highest possible price that often benefits creditors. Or it is a sale of a property of a protected person so that also here a reasonable price is intended.

How can we best ⁇ that high price? By ⁇ ining a two-day sitting scheme, or do we ⁇ that goal with a premium and a setup price?

After all the discussions, I am not convinced that this choice will indeed lead to higher prices. I am also not the only one who thinks so. The argument is that this practice is already being applied in some provinces. I quote a newspaper article by Frida Deceuninck in The Standard: “That some people also fear that leaving the second day of sale will have a negative impact on price formation.” She refers to a number of regions, such as Leuven and Turnhout, where the system of two sitting days works well and actually contributes to correct pricing. Proposing as if this is a system to get the best possible price is questionable.

Why my doubts? I address you, Mrs. Smeyers, because you have repeatedly said in the committee that it will be so, that a second day of sitting will not lead to a higher price and that the award of a premium will effectively lead to higher sales prices.

I asked you where you were based. You would give us numbers, but a week later we still didn’t have them. You cannot make it hard. So I remain with a few questions.

Secondly, the prizes. I notice a strange evolution in the debate. Initially it was intended to award a premium of 0.5 percent. You and colleague Terwingen submitted an amendment to raise that premium to 1 percent, but also to award it to the first bidder, even if this would not be the buyer. There was a lot of discussion on this subject and so a week later you submitted another amendment to reverse this proposal.

Then you say: we make sure that the problem of the prize hunters is solved, but you had that problem of the prize hunters first created yourself!

That is the reality. I think everyone in the committee saw that too.

Colleague Van Hecke, colleague Terwingen has requested the word to interrupt you.

Mr. Speaker, I would like to respond to this point, also on behalf of Mrs. Smeyers.

Our initial proposal indeed stipulated that only a wager premium would be awarded to the person who would eventually make the purchase. You may be sure to know how it went, Mr. Van Hecke. At some point, at the request of the notaries themselves, the additional condition that it should be granted to the final buyer has been removed. Only that hypothesis has been drawn out, because the notaries thought that granting a betting premium to everyone, even if one is ultimately not the buyer of the house, would lead to a higher bet and a more dynamic sale. Eventually, the condition was re-introduced, because we, as wise as we are, listened to comments like yours. Thus, in the initial bill submitted by Ms. Smeyers and myself, it was already noted that the wager premium could only be obtained on the condition that the wager price was also determined by the buyer who would eventually purchase the good.

Mr. Terwingen, you confirm what I just said. There was an attempt to do it in a different way. Apparently, however, the position of the notaries has persuaded you to give up the first amendment and return to the original text.

The amendment came after the advice of the Federation. We first followed the advice of the Federation, by submitting an amendment, but when we looked closer we found that we did not follow that part of the advice of the Federation. You were there too. We then returned to our original proposal with a second amendment.

You correctly say that the opinion of the Federation had a great impact on us, while the part about the premium just had no impact. We submitted an amendment to return to the first proposal, which was also supported by the majority of the committee. That support was shown only after the debate in the committee. Hence, we return to the original proposal.

That is clear, but do not say that your proposal will solve the problem of the prize hunters, because it was originally intended, in the first amendment, to make the problem even worse.

Mrs Smeyers, I have heard your argument here well. I have the impression, and you also say it literally, that you have actually followed the notaries. You were almost the right hand of the notaries. They were also present there. I think that is a little regrettable. Mr. Terwingen has proposed at some point to do so, because one is out of it in one day. It may have been a slip of the tongue. I wonder what the purpose of this bill is. Is it really intended to ensure that the sale price is as high as possible or is it intended to make the work of the notaries a little easier by completing the procedure in one sitting day, so that they do not have to move to a second sitting day?

Your speech triggers reactions. Mr. Clarinval asks for the word.

In contrast to Mr. Van Hecke claims that the final text puts an end to all the velenities of the prize hunters! There have been different versions but what matters is the final text!

It should not be left unambiguous: the bonus hunters will not have the possibility of action within the framework of the final text adopted and this thanks to the amendments that were voted following the discussions in the committee.

Mr. Speaker, after all the amendments, we have come to a text that should address and avoid the problem in question.

My conclusion remains that I am not convinced that the proposed way of working will lead to the best pricing. This was not proved, neither by numbers nor by arguments. On the contrary, there are other voices, which argue that the aforementioned way of working can create a problem.

For the above reasons, we will abstain from voting on the proposal.

Mr. Speaker, I will give my explanation on my bank. Most of it has already been said.

For the sake of clarity, I would like to ask for the attention and support of the present bill, which dates back to the good, old days of the cartel. I would like to thank Ms. Smeyers for jointly submitting them.

( ... )

Mr. Annemans, that is exactly what I say.

For the sake of clarity, Mr. Speaker, it is important that we address the main points of the current legislation. After all, we all, the people’s representatives, who will vote on the bill so soon, must realize that it is actually a law that is very short of the people.

The almost folkloristic system of two sitting days is so embedded – it also forms the core of the bill – that that habit must now be “cultivated”. As soon as it becomes clear to the people that there will be only one sitting day from now on, holding only one sitting day at that time will also no longer affect the prices. On the contrary, there will be more efficiency at that time.

For the Chamber Members who are addressed tonight at the café to explain what the draft law exactly means – Mr. Speaker, this also applies to you – I will quickly add three points.

First, there is only one sitting day left. I would like to come back to that for a moment. Also for Mr Van Hecke it must be clear, in all honesty, that the proposal of only one sitting day, which is initiated mainly by notaries, goes against the financial advantages of a notary. A notary who can hold two sitting days earns more than if he has to organize one sitting day. In this regard, notaries are therefore honest in their opinions, in particular that a more efficient way of working needs to be achieved.

The fact that the notaries themselves request to hold only one sitting day also means that they assume that on that one sitting day the prize can indeed be earned. A notary is also interested in making the price as high as possible.

As soon as the population is well aware that there will no longer be two sitting days, they will ⁇ use that one sitting day to reach a high price determination.

Second, it is important that now there is the possibility of the setting price. The notary can then take the initiative to determine the price, whether or not after receiving a report. It is a more efficient way of working. You should not start with the first offer, you start with a certain set price. Thus, one gets the efficiency that only the truly interested buyers will be involved, which allows the case to be handled faster and better.

Third, there is the conscious wager premium. I would like to reiterate that in the initial proposal made by me and Mrs. Smeyers it was stipulated that that betting premium would be awarded to the one who offers the first prize, provided that that bidder eventually also buys. I would like to say again for all clarity that the notaries had initially asked to amend that the wager premium is given to the one who offers the first prize, whether it is the final buyer or not. By working well with all interested parties, we have been able to decide in the committee that the wager premium can only be obtained by the person who also realizes the purchase. I look closely at my colleague of Mr. I think that such a pillar and perk is put to all possible malafide practices by, among other things, prize hunters.

These are the main lines. For details, if you wish, you can visit me after the plenary session in the coffee room next door. For all clarity, I think here is a very good proposal on the table. It is a social proposal and I therefore hope for the support of the socialist comrades. After all, it is simply a cheaper way of proceedings for each party involved, both the seller and the buyer. In addition, the proposal also provides for a simplification of the procedures, the dada of the liberal friends. Therefore, I have no doubt that CD&V and N-VA, the submitters of the proposal, will be able to count on a large majority at the vote as soon as possible.

Mr. Terwingen, we note that you keep your weekly sitting day in the coffee room next door, for the benefit of parliamentarians and also other interested citizens.