More than a third of buyers and sellers who experience a collapsed property transaction lose £1,000 or more according to new research highlighting the financial toll of fall-throughs.
The findings, published in LRG’s Winter Sales Report, reveal the hidden cost of failed deals, with survey fees, solicitor bills and mortgage arrangement charges often unrecoverable when a transaction breaks down.
The report, based on a survey of 221 buyers and sellers across England and Wales, found buyers are particularly exposed.
Four in five buyers who had experienced a fall-through reported significant financial losses, compared with 62% of sellers, reflecting the higher upfront costs typically carried by purchasers.
ONE IN THREE TRANSACTIONS FAIL
With around one in three property transactions failing across the industry the issue remains widespread.
The Government’s Home Buying and Selling Reform consultation has proposed measures including legally binding offers to reduce late-stage withdrawals with 80% of respondents backing the idea.
Neil Louth (main picture, inset), Executive Board Director at LRG and CEO of The Acorn Group, says: “These statistics represent real families who’ve lost real money through no fault of their own. This is exactly why reforms like binding offers matter.
“If both parties are committed earlier, those costs are far more likely to result in a completed sale.”
BINDING OFFERS
And he adds: “The current system asks buyers to invest significant sums before there’s any guarantee the sale will complete.
“Binding offers would create accountability on both sides and help ensure that £1,000 is far more likely to lead to a set of keys.”
With reform proposals now under consideration, the industry is watching closely to see whether structural change can finally reduce the financial risk hanging over home movers.
