Property sales are increasingly being renegotiated before completion as economic uncertainty continues to weigh on buyer confidence, according to north London estate agency owner and former RICS residential chairman Jeremy Leaf.
Leaf says that while the vast majority of agreed sales are still progressing, buyers are taking a harder look at agreed prices amid concerns over the impact of the conflict in Iran on inflation and mortgage rates, as well as uncertainty surrounding potential tax changes – a trend many estate agents across the country are also reporting.
The result, he says, is a more cautious market, with buyers taking longer to make decisions and agreed deals coming under greater scrutiny before exchange.
“We have noticed in our offices that the recent drop in transaction numbers is just as much to do with ongoing concerns about the impact of the protracted Iran war on mortgage rates and inflation as possible changes in taxation,” he said.
Leaf continued: “There’s no doubt that speculation about the possible impact on buying and selling costs is compromising an already-sensitive market, prompting some price softening as well as delaying decision-making.
“The overwhelming majority of sales are proceeding but facing more regular scrutiny – and often re-negotiation – before doing so.”
The rise in renegotiations comes against a backdrop of a slower-than-usual summer housing market.
Figures published by Zoopla this week showed property sales have fallen across almost every region of Britain compared with a year ago, with the North East the only area to record an increase in sales activity.
Commenting on the figures, Zoopla executive director Richard Donnell said the seasonal slowdown had been more pronounced than normal as higher mortgage rates and political uncertainty continued to weigh on buyer confidence.
However, he noted that the market remains active, with transactions continuing to complete and house prices still rising across much of the country. He added that buyers now have greater scope to negotiate on price than they have had for some time, reflecting a more balanced market than in recent years.
