Tuesday 4 July 2023

Fall-Throughs Rife (55%) - What Does This Mean for Sellers in the South London Property Market?

Down but Up

The number of property transactions falling through in South London has decreased in the first quarter of 2023, compared to the same period in 2022. This is good news because figures from Quick Move Now have revealed that 55.8% of property sales in England and Wales collapsed before completion, as uncertainty continued to plague the property market. According to research by property purchasing specialist House Buyer Bureau, the total number of fall-throughs in South London decreased by 11% in Q1 2023, from 7,139 to 6,397. This is also 16% lower than the previous quarter, Q4 2022. Hurrah!

Wasted money

The average cost of a fall-through in South London increased by 2.1% in Q1 2023, from £3,320 to £3,370. The drop in the number of fall-throughs is likely due to a number of factors, including:
  • The cooling of the South London property market. The market has been slowing down since September last year, following the mini-budget.
  • The increase in interest rates. The Bank of England has raised interest rates five times since December 2021, making it more expensive for buyers to borrow money.
  • The ongoing cost of living crisis. Rising inflation is putting pressure on household budgets, making it more difficult for buyers to afford a deposit.
Despite the decrease in the number of fall-throughs, the average cost of a fall-through has increased. This is likely due to the rising cost of property in South London. Chris Hodgkinson, Managing Director of House Buyer Bureau, said: "The number of fall-throughs in South London has decreased in the first quarter of 2023, but the average cost of a fall-through has increased." This is likely due to a number of factors, including the cooling of the market, the increase in interest rates, and the ongoing cost of living crisis. While the total number of fall-throughs is down, buyers and sellers should remain aware of the risk of a sale collapsing. Buyers should make sure that they are financially prepared for a potential fall-through, and sellers should be realistic about their asking price. This is where an experienced property agent can help you manage expectations. If you are a seller in South London, it is important to do your research and make sure that you are working with a reputable estate agent who can help you to navigate the current market conditions.

The most common reasons for fall-throughs are:
  • The buyer's financial circumstances change and they can no longer afford the property.
  • The seller finds a better offer for their property.
  • There are problems with the property that were not disclosed to the buyer.
  • The buyer or seller cannot agree on the terms of the sale.
  • The risk of a fall-through is higher for certain types of properties, such as new builds (service charge surprises, cladding etc)
  • Sellers can protect themselves against the risk of a fall-through by being realistic about their asking price and by making sure that they disclose any known problems with the property.

But...Good news!

Thankfully the market remains strong, although slightly subdued. Sensibly priced a property will attract plenty of attention provided it is marketed in the right light of course. Having an agent with some experience to guide the (first time?) buyer as well as bank of mum and dad through the process will pay dividends. Nobody wants to start afresh I'm sure! What's your place worth? Check out my online valuation tool here, follow me on instagram for videos etc or drop me an email and get me around to value your property!

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