Half of property sales fell through within the last 3 months of 2022, based on research by property-buying firm Quick Move Now.
The finding, which provides coverage for transactions in England and Wales, represents a high increase on the previous quarter of 2022, whenever a comparatively low 28% of transactions failed.
So, so why do fall-throughs happen and just what are you able to do to ensure your property sells? Below, we explore the most recent market activity and provide suggestions about selling your house in 2022.
Increased competition among property sellers
According to research agency TwentyCi, the number of properties on the market climbed by 4% in 2022, but exchanges fell by 1.2%.
Brexit is likely to be a factor within this: with ongoing uncertainty around what's going to happen once the UK leaves the EU, buyers are understandably nervous.
However, fall-throughs aren’t a problem across all of the UK. The proportion of 2022 transactions that fell through after a sale have been agreed was higher in England (22%) and Wales (23%) than in Scotland (10%) and Northern Ireland (10%).
Why do house sales fall through?
According to Quick Move Now, the most typical reason for failed property transactions is the buyer pulling out (30%).
Gazumping, where the seller accepts a higher offer from a different buyer after the original sale continues to be agreed, makes up about 19% of failed sales.
Issues revealed by a house survey were the third-highest factor at 16%, followed by difficulty securing a mortgage (13%), the customer or seller feeling that things weren’t progressing (10%), other areas from the chain collapsing (9%), and gazundering (3%), where the buyer reduces their offer after the sale continues to be agreed.
As a seller, not every one of these will be within your control, but you will find steps you can take to reduce the chances of a fall-through.
1. Choose your buyer carefully
If you’re within the fortunate position of having multiple offers up for grabs, don’t choose your buyer based purely in price.
The buyer’s situation is important: if they’re chain-free (for instance because they’re a first-time buyer or currently renting) they could be a safer bet.
It’s also worth finding out whether they have a home loan agreement in principle – a statement from a lender confirming that they’re willing, in principle, to lend a certain amount – as this will indicate the likelihood of their mortgage application being accepted.
A good estate agent will vet potential buyers to check that they’re likely to be able to proceed using the purchase.
2. Be organised
It’s smart to select a conveyancer or property solicitor prior to getting towards the offer stage, but when you haven’t, make sure you do so quickly.
Similarly, having all of your paperwork ready might help quicken things and show the buyer that you’re organised and prepared to move swiftly (our help guide to conveyancing when you’re selling includes a checklist of all the documents you’re likely to need).
Keep in regular contact with the estate agent and let everyone determine if you’re going on holiday and will also be unable to answer queries or sign documents.
3. Take suggestions about your mortgage options
If you’ll need a mortgage for that home you’re moving to, it’s worth speaking with an independent mortgage broker to have an accurate concept of how much you’ll be able to borrow.
You could also need to weigh up the advantages and disadvantages of porting your mortgage versus exiting your current deal and trying to get a replacement.
4. Be open to negotiation
If your buyer has a house survey done in your yard also it reveals problems, they may ask you to fix the issues or provide a lower price.
Consider what they’re asking and take advice from your solicitor if you’re unsure. Many sellers have rejected such requests in the heat of the moment only to regret it when the sale collapses plus they struggle to find another buyer.
How to sell in a competitive market
With more homes on the market and many buyers unwilling to invest in a purchase before Brexit, fall-throughs are just area of the problem – actually receiving an offer has been a challenge for many. With this thought, we asked NAEA Propertymark, which represents auctions across the UK, for advice for sellers.
Mark Bentley, president of NAEA Propertymark and expert on the West Midlands market, says it’s essential that you manage your price expectations.
He said: ‘Brexit causes a great deal of uncertainty. Sellers have no idea whether to put their property available on the market now and buyers are unsure whether to make offers.
‘With supply so low and demand fairly reasonable, prices will normally hold up, but sellers have to be sensible using their prices and never too ambitious.’
Meanwhile Katie Griffin, an NAEA representative located in the South West, told us: ‘Homes should be presented well, with excellent photography that is refreshed regularly.
‘We are finding walk-though videos and 360-degree tours are promoting our sellers' homes, coupled with realistic pricing.’
