House sales failures in UK up 9% quarter on quarter

Taylor Scott International News

The number of house sales failing to successfully complete in the UK increased in the second quarter of 2016, with more than one in four sales falling through. A house sale fall through rate of 29% was recorded by the latest research from independent home buyer Quick Move, up 9% from the first quarter of the year. The annual year to date fall through rate ended the second quarter of the year at 25.18%, up 3.56% since the end of the first quarter, the data also shows. According to Danny Luke, business manager at Quick Move, the first half of 2016 has been an interesting time for the UK property market. ‘Strong demand and low supply in many areas has led to a strong financial performance, but the market also faced a great deal of uncertainty with stamp duty changes, more challenging conditions for investors, and most recently the European Union referendum. This uncertainty is reflected in the reasons why sales fell through before completion,’ he said. The top reason was a buyer changing their mind, accounting for 47.37% of failed sales, followed by 15.79% due to the seller renegotiating a better offer with a new buyer, the same amount was due to difficulty securing a mortgage and the buyer or seller pulling out of the sale because they felt it wasn't progressing quickly enough while 5.26% was due to legal issues. ‘It seems the uncertainty that has dominated the property market in the last quarter has led to prospective buyers putting in panic offers. It used to be usual to do at least a second viewing, potentially even a third, before making a formal offer on a property, but shortage of supply in some areas, alongside widespread market uncertainty as we drew closer to the referendum, led to many prospective buyers feeling pressure to make offers on a first viewing, fearing that they may miss out if they delay,’ Like explained. ‘Once the dust has settled and the sales start progressing, the cold feet can start to set in, possibly due to nerves about the size of the financial investment and whether they've selected the right property or when surveys highlight potential issues,’ he pointed out. ‘As we move forward in post-Brexit Britain, I would expect to see the market slow, and potentially see the fall through rate continue to rise, as market uncertainty and instability continue,’ he concluded. Taylor Scott International

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