Aborted Sales Fall
Quick Move FTI* falls to 28%The aborted sale rate has fallen to the lowest level since early 2007.
We have now seen a consistent improvement in the fall through index over several months although we would expect that in reality , in the non-professional market, at least 1 in 3 property deals is still aborting before completion.
To understand the driving force behind this trend we need to understand what is happening in the wider property market.
During 2008/9 we saw rapidly falling house prices, low buyer confidence and huge uncertainty in the mortgage market all of which lead to a high number of aborted sales.
Over the last 6 months we have seen buyer confidence and mortgage finance increase. At the same time the volume of property on the market has not increased to match the higher demand. With the increased competition, home buyers have tried really hard to keep chains together as the options for alternative purchases are limited. Therefore we have seen the level of aborted sales fall.
This basic explanation does however hide huge regional variation. Improving house prices and sales volumes are being driven by London and the South East in much of the rest of the country sales volumes remain extremely low with prices remaining static or falling.
So what does the future hold, well we are expecting the housing market to have a very difficult second half of the year.
All the major indicators are showing signs of another slowdown. House prices increases have either stalled or reversed, asking prices have fallen and transaction levels are falling.
The new coalition has also scrapped HIP’s which means that the costs/barrier to putting your property on the market has been removed. We expect the number of people “testing” the market to increase so increasing supply.
If supply increases and demand falls or remains subdued, logic would suggest prices will fall and uncertainty will increase.
We are also just entering the summer holiday period where traditionally the housing market takes a breather. So the big question is what will happen in September and with all the looming public sector redundancies causing massive uncertainty we could well see another slump in the housing market, which could well lead to higher levels of aborted house sales.
*This figure is based on house sales that are professionally qualified and managed and the true rate of fall through for normal house buyers and sellers is likely to be much higher.
What is the Quick Move FTI?
Not all property sales that are agreed go on to complete and the percentage of sales falling through varies greatly with prevailing market conditions.
When a chain collapses sellers can face a number of issues:
-Large delay in selling as whole marketing/sale process is restarted.
-Lose onward purchase.
-Remain exposed to changing market conditions.
-Lose out financially with costs sunk into solicitors, estate agents, home information packs, survey and mortgage fees often exceeding £2000.
Quick Move agreed over 500 sales last year but like any seller we have trouble with chains and sales falling through. This is despite a dedicated sales progression team and detailed assessment of every buyer, their finances and related chain. The average home seller doesn’t qualify buyers to the same degree, so the general market fall through rate is much higher.
The Quick Move FTI is a 6 month moving average measuring the percentage of agreed sales that fall through.
The index is uniquely placed to give a current indication of how market conditions are affecting general home owners looking to sell their property.
Quickmovenow.com specialises in the rapid cash purchase of residential property. And our professional and competitive service provides clients with a quick, secure and efficient sale.
We assist clients in a range of circumstances but if your specifically want the certainty of selling without the complications of a chain or have been involved in a broken chain and want to secure your onward purchase-Quickmovenow.com could help.
If you want more information please complete a free online estimate or contact us direct on 0800 068 3366.
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