29% of property sales falling through before completion

More than one in four property sales fell through in England and Wales between July and September this year, according to new figures.

Our figures suggest 29% of property sales fell through before completion in the third quarter of this year.

Why are sales falling through?

The reasons behind sales falling through tell an interesting story. The main cause of unsuccessful property sales during the last three months is difficulty securing a mortgage. This accounted for 40% of collapsed sales.

A further 27% of failed property sales were caused by the buyer changing their mind or unsuccessfully attempting to renegotiate. The remaining sales falling through were attributed to chain break (14%), gazumping (12%) and survey issues (7%).

Quick Move Now’s managing director, Danny Luke, commented: “Whilst the latest fall-through rate is 2% higher than the same quarter last year, it is 10% lower than the third quarter of 2022. It is also significantly lower than the peak we saw in Q1 2023. This demonstrates how much the market has settled after the economic uncertainty of the last few years.

“People may be surprised by the high number of property sales falling through as a result of difficulty securing a mortgage. There is, however, good reason for this. When sales volumes were lower, only those in a very strong financial position were moving. Higher mortgage interest rates meant much of the market was being driven by cash purchases. Mortgage interest rates have now started to fall. This means sales volumes are increasing and a greater number of sales are reliant on mortgages.

“Many existing homeowners who are considering moving are unaware of how much higher interest rates and cost of living will impact their mortgage affordability assessments. We’re also seeing lenders exercise more caution when approving mortgages. The economy is picking up and there is a lot more optimism in the market. However, lenders are vigilant to several external factors that have the potential to impact future inflation and buyer affordability. This includes current foreign political uncertainty and global conflicts.   

“According to recent figures, each failed property sale costs buyers and sellers an average of £3,370*. This means that last year alone failed property sales cost the public an estimated £909million.”

*Cost per failed transaction taken from  https://www.orlandoreid.co.uk/about-us/stories/buying-and-renting/fall-through-fears-what-do-failed-home-sales-mean-for-buyers-and-sellers/