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.”