More than a quarter of residential property sales fell through in the UK during the second quarter of the year mainly because buyers got cold feet over Brexit, new figures show.
Fresh data provided by independent home buyer, Quick Move Now, reveals that 29% of home sales fell through in Q2 of 2016, up 9% from the reported 20% in the first quarter of 2016.
Those looking for a greater overview of how the property market is performing generally only need to refer to Quick Move Now’s annual year-to-date fall through rate, which even when allowing for seasonal peaks and troughs shows that that the fall through rate ended the second quarter of the year at 25.18%, up 3.56% since the end of the first quarter.
Danny Luke, Business Manager at Quick Move Now, commented: “The first half of 2016 has been an interesting time for the UK property market. Strong demand and low supply in many areas has led to a strong financial performance, but the market also faced a great deal of uncertainty with stamp duty changes, more challenging conditions for investors, and most recently the EU referendum.”
According to the research, the most cited reason for a sale falling through was the buyer changing their mind at 47.4%. This was followed by the seller renegotiating a better offer with a new buyer at 15.8%, difficulty securing a mortgage, also at 15.8%, and buyer or seller pulling out of the sale because they felt it wasn’t progressing quickly enough, again at 15.8%.. The remaining 5.26% of sales failed to complete due to legal issues.
Luke continued: “It seems the uncertainty that has dominated the property market in the last quarter has led to prospective buyers putting in ‘panic offers’.
“It used to be usual to do at least a second viewing, potentially even a third, before making a formal offer on a property, but shortage of supply in some areas, alongside widespread market uncertainty as we drew closer to the referendum, led to many prospective buyers feeling pressure to make offers on a first viewing, fearing that they may miss out if they delay.
“Once the dust has settled and the sales start progressing, the cold feet can start to set in, possibly due to nerves about the size of the financial investment and whether they’ve selected the right property or when surveys highlight potential issues.
“As we move forward in post-Brexit Britain, I would expect to see the market slow, and potentially see the fall through rate continue to rise, as market uncertainty and instability continue.”