More than a third of property sales fell through last year, with buyers to blame in most cases.
A survey by QuickMoveNow found 35% of property sales fell through in 2023.
Of the sales that failed, its research found 49% were caused by the buyer changing their mind, attempting to renegotiate, or pulling out after a property survey. A further 19% of failed sales were attributed to chain-break, while 17% were blamed on slow progress. Another 10% were attributed to the buyer being unable to get a mortgage.
Danny Luke, of Quick Move Now, said “with all of the challenges thrown at the property market over the last 12 months, it’s little surprise that the biggest cause of failed property sales is the buyer changing their mind or trying to renegotiate the purchase price. Chain-break has also had a big impact on the number of sales that have fallen through. During the post-Covid property market boom, a chain-break could quickly and easily be fixed. That’s not the case in a slower property market. It can take weeks or even months to tie-up another sale, which will often lead to the whole chain collapsing. Buyer uncertainty is also showing in the number of property sales falling through due to slow progress. We’ve heard stories of buyers seeming very keen at first, but then getting cold feet and going quiet. Sellers are only happy to hold on for so long before they get fed up and pull out of the sale to put their property back on the market.”
Building societies set for major shake-up to help first-time buyers onto property ladder
Proposed reforms to building societies could provide a boost to thousands of first-time buyers hoping to get a foot on the property ladder.
These potential changes are supported by the House of Commons. The Building Societies Act 1986 (Amendment) Bill, which aims to modernise societies and increase their lending capacity, suggests these reforms. Labour's Julie Elliott put forward this planned legislation. It came after a government consultation looking into ways for building societies to compete on a more level playing field with banks" and stimulate competition in the financial services industry.
Ms Elliott's bill that is backed by the Government has just got through its second reading in the Commons, progressing with no opposition. Now, MPs and members of the House of Lords will take a closer look at it.
While discussing the bill in the Commons, Sunderland Central MP, Ms Elliott said: "although this Bill doesn't solve all the issues in the broken housing market today, it could free up more availability of money to lend in mortgages, and as building societies lend more in percentage terms to first-time buyers, then it should enable more first-time buyers to get on the housing ladder."
Modernisation of building society legislation is long overdue, there are some archaic requirements around the way they fund themselves that puts them at a competitive disadvantage when compared to banks. Competition in banking is good for consumers and given building societies drive innovation, particularly in supporting first-time buyers, strengthening the sector is a great route to supporting aspiration across the UK. Prudent lending is crucial to the UK's economic growth. Making this change will make building societies safe, more secure, and competitive in the long term, without affecting their status as mutuals."
Conservative former minister George Freeman stated "this is a really important Bill for updating the law, giving building societies a chance to get back to where they were in the early 90s they were responsible for something like 60% of the market, that's dropped down to 20%. Increasing lending capacity is in itself a huge step forward, I think the figure is £10 billion of extra lending capacity will allow the provision of another 20,000 mortgages, and particularly for first-time buyers that is hugely important."
Labour's shadow Treasury minister Tulip Siddiq commented "since 2020 building societies have supported 360,000 first-time buyers, that's over £63 billion provided to help people buy their first homes, that's why this Bill is so important. It will empower societies across the UK to raise more funds and help our vulnerable constituents."
Treasury minister Nigel Huddleston confirmed "that the Bill has the "whole-hearted" support of the Government. The Government sees this Private Member's Bill as a great way to support building societies, ensuring that they can compete with retail banks on a more level playing field, while continuing to provide essential competition to the UK financial services sector."