More than one in four sales across the UK fell through last year, claims a quick-sale company.
Quick Move Now claims a sale fall-through rate of 27.94 per cent for Q4 of 2015, far above the 19.62 per cent it reported in Q3.
Taking 2015 as a whole, it says 29.26 per cent of sales fell-through.
“Tougher lending criteria were introduced as a result of the Mortgage Market Review which meant some prospective buyers found it challenging to secure a mortgage, or found they were able to borrow less than they had anticipated. Nine per cent of sales that fell through did so as a result of not being able to secure a mortgage” says Danny Luke, Quick Move Now’s business manager.
However, the biggest reasons for house sales falling through in the final quarter of last year were more traditional ones - buyers changing their minds, problems identified at survey stage, or failed renegotiation following the survey.
Luke says a shortage of stock for sale may have led to anxious buyers putting in substantial offers on less-than-ideal properties - some purchasers will then have got cold feet or been deterred by a survey’s findings.
He says chain collapse still features prominently, causing over a fifth of the fall-throughs.
Sellers pulling out for a higher offer accounted for nine per cent of the fall-throughs.
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The entire house buying process in England requires root & branch reform. It's overly long winded and an absolute minefield for the seller (I've been there)
Right up until the point of exchange of contracts, either party remains vulnerable to a fall through, causing frustration and financial loss.
Whilst not an advocate of the Scottish system in it's complete form, I'd certainly like to see more contractual protection for both sides from an earlier stage.
Well said. The Scottish system isn't perfect - no system is - but it does give a lot more protection to buyers and sellers than is the case in England and Wales and, incidentally, much of Europe.
I wonder what proportion of these failed sales are accounted for by 'self sales' as opposed to using an agent.
What's new? Over 30% of transactions in chains of one fall through and the percentage rockets as the chains get longer. It's been like that forever. To use the Scottish system would require radical changes as their legal system has a completely different basis from English Law. Australia (English Law) and the USA (uses English law as persuasive precedent) have amended the system quite effectively with far fewer sales falling through and much faster transaction periods, so there is no reason why we cannot do the same, if there is a will.
Problem is, I doubt there is much of a will. People like to keep with the status quo as much as possible. Change is too frightening. The system needs reforming but will Brandon Lewis and chums have the power/ability to do so? I have my (severe) doubts.
Fake Agent: '' Change is too frightening'' - that can't be true, can it?
everything is changing al the time, we just have to make sure the change is for the best - that cannot be beyond the wit of man surely.
True, change is always happening, but major reform tends to take a little longer. It's easy to make slow, incremental changes, or react to the changing world - in the way many agents have embraced "online", the portals and social media - but it's much more difficult to carry out root and branch reform because of delays, opposition, cynicism, reluctance, etc, etc.
What do you expect from a "we buy any house" style company?? This is their only raison d'être! The figures are entirely normal and to be expected and yet they are attempting to twist them into a scare story. If people were legally forced into being ultra committed to buying or selling a property from the get go then far fewer people (particularly sellers) would enter into the process in the first place. We saw exactly this effect with HIPs when they were introduced. The housing market would see a significant down turn if such a thing were introduced in my opinion.
It's all about balance, at this stage the last thing we need to do is legally force sellers to commit to the selling process. However, if you have a team of highly experienced estate agents who know how to delicately negotiate then the fall through rate will remain low, it's really that simple.
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