1 in 4 house sales fell through in Q4 2015
New data released today by Quick Move Now, has revealed that the house sale fall through rate rose in the last quarter of 2015, with more than 25% of sales failing.
Figures indicate a house sale fall through rate of 27.94 percent for Q4 of 2015, a rise 8.32 percent from the reported 19.62 percent in Q3.
Quick Move Now also released figures for the annual year-to-date fall through, which offers a greater overview of how the property market is performing generally, allowing for seasonal peaks and troughs. The year-to-date fall through rate remained fairly constant throughout 2015, at around 29 percent, and finished the year at 29.26 percent.
Danny Luke, Business Manager at Quick Move Now, commented: “2015 was an interesting year for the UK property market, and the fall through rates reflect that. Tougher lending criteria was introduced as a result of the Mortgage Market Review (MMR), which meant some prospective buyers found it challenging to secure a mortgage, or found they were able to borrow less than they had anticipated. In fact, nine percent of sales that fell through did so as a result of not being able to secure a mortgage.
The two biggest reasons for house sales falling through in Q4 2015 were buyer changing their mind (27.2 percent) and problems identified at survey or failed renegotiation following a survey (27.2 percent), which is unsurprising in the current market. 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 through fear that they'll be unable to find anything else. Some inevitably get cold feet about such a large investment, or find that a survey confirms their fears, and pull out before the sale completes.
Danny continued: "Chain collapse still featured prominently, with 22.7 percent of property sales falling through as a result of chain issues, and it's definitely an issue very much on sellers' minds. We get calls every day from sellers keen to secure a guaranteed sale so they don't risk missing out on their onward purchase due to chain collapse.
Seller pulling out for a higher offer (9 percent) and buyer health issues/personal problems (4.5 percent) make up the remaining failed completions.”