There has been a significant increase in both the number of property transactions falling through in Q3 of 2022, as well as the cost associated with these collapsed deals, the latest figures show.
Fresh analysis of the number of transaction fall throughs across the UK property market by the Home Buyer Bureau reveals that in Q3 of last year, 90,188 transactions are estimated to have fallen through, a 15.6% increase on a quarterly basis and a 3.6% uplift versus this time last year. This is also the highest quarterly number of fall throughs recorded over the last five years.
What’s more, a combination of runaway inflation and increasing house prices have pushed the average cost of a property transaction collapse to £3,337.
Consequently, the House Buyer Bureau estimates that homebuyers and sellers were hit by a total estimated cost of almost £301m as a result of their transactions falling through in Q3 2022.
This total cost is not only 18.7% up on the previous quarter, but also 16.3% on an annual basis.
The MD of House Buyer Bureau, Chris Hodgkinson, said: “We’ve seen a consistent increase in the number of property transactions falling through in recent years and despite a fairly settled start to 2022, the latest data shows that the number of sales collapsing hit a five year high in the third quarter of 2022.
“This is almost certainly due to the turbulence that came via the mortgage sector in September, as lenders pulled a raft of products and increased mortgage fees in reaction to the Bank of England’s aggressive attempts to curb inflation via a string of consecutive interest rate increases.
“As a result, many buyers found that they could no longer afford the cost of borrowing which has led to swathes of property sales falling by the wayside during the second half of last year.
“Unfortunately, we saw a further hike to the base rate come in December and so the likelihood is that this increased level of property fall throughs will not only be apparent within the final quarter of 2022, but it’s likely to be maintained into 2023.”
The cost to buyers and sellers might be £301m a quarter but what about the cost to estate agents as well. There is every reason for estate agents to help their clients prepare the property documentation to achieve a quicker exchange. ” week exchanges should be the target. Tim Main
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