Four in 10 sales have been falling through before completion – claim
Figures from cash home buying company Quick Move Now also show a 9% increase in failed sales over the last three months.
Four in 10 property sales were falling through before completion in the third quarter of the year – and before the mortgage panic sparked by the mini-budget last month.
Figures from cash home buying company Quick Move Now also show a 9% increase in failed sales over the last three months.
COLLAPSE
Of the sales that collapsed, four in 10 (41%) failed due to buyers changing their mind about the purchase and a further one in four (24%) failed when the buyer was unable to get a mortgage – suggesting growing caution from both buyers and lenders.
Danny Luke (pictured left), Quick Move Now’s managing director, says: “It’s concerning to see that the number of property sales falling through before completion seems to be on the rise again. It is, however, not a huge surprise given the current turmoil in our economy.
“It’s been well documented that measures to boost the property market after Covid, alongside a shortage of stock, led to an overheated market and steep rises in property prices.
“It would be naïve to think that the economic climate we now find ourselves in would not heavily impact the confidence of both buyers and mortgage lenders.”
Luke adds that rising inflation and interest rates have had a huge impact on affordability and that anxiety amongst both buyers and sellers is rising rapidly.
Sadly, I would expect this pattern to continue throughout the final quarter of this year and well into 2023.”
He says: “Just last week we witnessed the removal of 40% of mortgage products from the market and saw a growing number of predictions of a crash.”
STAMP DUTY
The Government recently announced another stamp duty reduction in a bid to keep the market going, but Luke says that any saving made on the hated tax will be wiped out by the rise in interest rates for those requiring a mortgage.
He adds: “It’s little surprise that the biggest causes of failed property sales in the last three months have been buyers changing their minds and difficulty securing mortgage finance.
“Sadly, I would expect this pattern to continue throughout the final quarter of this year and well into 2023.”