Mark Snape is chief executive officer of Broker Conveyancing
The old adage about ‘lies, damn lies and statistics’ was brought home to me recently when reviewing some data around the number of property sales in England and Wales that fall through.
Quick Move Now, a company that buys property, collated this data, and for the first quarter of 2021 the stats read that “fewer than one in three (32%)” of sales fell through.
This use of the word ‘fewer’ immediately raised my ire, as if the fact that pretty much one in three transactions falling through is anything to be positive about.
Three purchase customers come into your office – or in pandemic times, conduct a Zoom call with you – and of those three, one is likely to see their hopes of purchasing their home dashed.
That, to me, doesn’t seem like a positive worth highlighting – indeed, it just shows that there are a number of fundamental issues that need addressing quickly.
However, if you consider 2020 as a whole, Quick Move Now’s 2021 Q1 data is apparently better than what customers were dealing with last year.
Then, the fall-through rate was deemed to be 43%, and it won’t take a genius to work out that this is close to one in every two purchase transactions falling through. Perhaps it’s small mercies that we’re not seeing that figure go up, rather than down.
And yet, in a misreading of the room which you would only think possible if you were the owner of a top six English football club, there seems little to shout about when one in three customers are likely to be losing money because they’re unable to complete the purchase they set out on.
Why are sales failing? It’s a combination of reasons, but mostly it’s down to people changing their minds as they work through the transaction, and given the way that our system works, it’s also likely to be due to information coming to light which doesn’t meet with the original expectations of those involved.
Other reasons include an inability to secure a mortgage, unsuccessfully trying to renegotiate a lower price, or gazumping – which we’re led to believe has also increased as the supply of properties falls and, as a result, higher offers come in at later dates.
What must consumers themselves think about such a process? Where property information, which can fundamentally change their views on a home, only appears weeks or months down the line? Where there is no certainty that their accepted offer won’t be usurped by a higher one? Where a seemingly committed party can change their mind on a whim or drop of a hat, leaving them having to start over again?
The fact that there is so little certainty within the housebuying process until the point of exchange or completion makes an already stressful situation even more so for all involved.
This is especially true when you have a large chain of transactions all reliant on each other, and in which one break in the chain can bring everyone else down with it.
You might have done everything within your power to successfully transact, but it counts for nought if other parties decide that this purchase, which they were so sure about just weeks ago, is now not for them.
It’s no wonder, given this situation, that there is a growing focus on getting our system fit for purpose, let alone working super-efficiently.
I’m completely aware that thousands upon thousands of transactions complete successfully every month, but what could we achieve with a system which has certainty built in? Where the provision of upfront information means no nasty surprises down the line, where there is a commitment from all those involved to complete, and where everyone has their ducks in a row at the start, rather than attempting to get them in order over the course of months and months.
This would allow us to start from a much firmer foundation, and would help all stakeholders achieve their aims within a much shorter timescale.
It cannot be a source of pride for our sector that it takes four to six months to complete a purchase, especially when we should all be acutely aware that a quicker process provides us with the ability to work with more clients and to earn more income.
One in three customers going away disappointed from their potential purchase is not a badge of honour – even if it is better than last year.
That level of aborted transactions has to change – we have the means to do it and there is no better time than the present to deliver.