The number of house purchases failing to successfully complete in the UK dropped in the first quarter of 2016, with just one in five home sales falling through, according to new research.
Figures indicate a house sale fall through rate of 20 per cent in the first quarter of the year, a reduction of just under 8% from the final quarter of 2015.
The annual year to date fall through, which gives a greater indication of how the property market is performing generally, was fairly constant throughout 2015 and into the start of 2016 at around 29%.
A commentator said “The start of 2016 has been an interesting time for the British property market. Strong demand and low supply in most areas has led to a strong performance and whilst it is positive to see that the number of sales falling through before completion fell in the first three months of 2016, many property owners and potential buyers would still be shocked to learn that one in five sales falls apart.”
The two most common reasons why house sales didn’t complete in the first quarter of 2016 were the vendor pulling out of the sale for a better offer and either vendor or buyer pulling out because they felt the sale wasn’t progressing quickly, both at 25%.
Many areas are experiencing very strong demand and low supply, so vendors are determined to achieve the best possible price for their property. This makes them willing to pull out of an agreed sale if made a higher offer.
Other reasons included the purchaser changing their mind (18.75% of cases) while a buyer being declined lending by a mortgage provider accounted for 12.5%. The chain collapsing, survey issues and a buyer wanting to renegotiate after the initial offer had been accepted all accounting to 6.25%.
A lack of properties coming to market has led to prospective buyers having to move very quickly in order to secure a property, and may mean they put an offer in on a less than ideal property due to fear that they’ll be unable to find anything else, which accounts for buyers changing their minds and trying to renegotiate after the initial offer has been accepted.
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