Despite all the change and (often) turmoil of the last 12 months, there will be a great deal of property and housing market stakeholders who enter 2025 with a feeling of déjà vu about what is required see some of the improvements we might all believe are essential.
At the start of 2024, for example, and many years prior to that, I would have entered a new year wondering whether we’d be able to finally see the improvements in the home buying and selling process, which would deliver results such as speeding up the timescale to exchange and, of course, reducing the number of fall-throughs.
On that latter point, I saw some recent data out of property firm Quick Move Now that suggested close to a third (28.8%) of all residential property sales failed to complete in 2024, citing transaction stoppers such as a renegotiation of the purchase price, buyers changing their minds, difficulties getting a mortgage, sellers accepting a higher offer, chain breaks, and sellers pulling out due to slow progress.
There will be nothing surprising to anyone working in our market about the reasons why transactions fail; looking at Quick Move Now’s regular quarterly data on this, it has actually come down from 35% of all transactions back in Q1 of 2024.
Abandoned transactions plaguing the market
Close to three in 10 transactions are still falling through, and you don’t need to be a genius to work out the resource and actual cost of these sales and purchases not making it through to completion.
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The lost revenue for property market stakeholder firms in itself must be eye-watering, from mortgage advisers to lenders and all in between, from surveyors and valuers to conveyancers, insurers to removal firms, not forgetting the potential hit to retail activity missed due to these completions not happening.
Now, I’m under no illusion that the source of this data is a firm that buys property quickly from owners. Clearly, for some property owners, the need to complete in as quick a timescale as possible is a significant priority, and firms like this might well have the ways and means to achieve quick sales.
That said, the reasons outlined for aborted transactions are indeed commonplace. Too commonplace, in our opinion, which is why we have been focused on a workstream for over a decade that aims to cut down on the number of fall-throughs, deliver greater certainty for all parties, and ensure information is in the hands of the people who need it to decide the very start of the process, not halfway through it when they have already become emotionally and financially committed.
Minimising fall-throughs with upfront property information
There is plenty that can scupper a transaction, not least the very common notion of changing one’s mind, but there is also much that scuppers transactions that doesn’t need to.
Which should result in a changing of the mind, for example, before any work has actually got underway.
In the mortgage sense, if you have a client who can only afford to secure a mortgage that allows them to buy homes valued at £300,000, then there is little point in them wasting anyone’s time on those valued at £400,000.
A need for change
In our world, we want all information about a property to be accessible digitally from as close to a single source as possible. We certainly want agents to be both regulated and to ensure their clients have full upfront material information on a property before they make any decision about potentially offering to buy it.
We also want information to be available digitally, to be usable in digital form, which would help cut down on the paper race that unfortunately continues to dominate transaction work for too many conveyancing firms.
In last year’s pre-election period, the now Labour government talked a pretty good game on all these measures, and while it is early days in this Parliament, we await to see whether these words can be put into action, and can they genuinely bring down the number of transactions that don’t make it to exchange?
Certainty is vital. Without delivering more of it into the process, and ensuring certainty is delivered right at the start, we are liable to keep on seeing transactions aborted in the numbers we have witnessed in recent years. It can’t continue to be acceptable that three out of every 10 people who start down the path of wanting to buy a specific home never make it through the front door with the keys in hand.
The cost savings alone for all concerned from introducing such certainty would be phenomenal, and it would ensure against a huge amount of wasted – and most importantly, unpaid – work.
That has always been a goal worth pursuing, and it is a real shame we have to keep pursuing it this year, after so many years of wanting it.
