Like all industries, the housing market has faced challenges this year, but since lockdown restrictions were lifted, house sales have started to increase. Nevertheless, an accepted offer doesn’t always lead to a sale.
The main problem that leads to housing sales falling through is that in England and Wales, an accepted offer is not legally binding and both parties can still pull out right up until exchange of contracts. Research shows that approximately a third of house sales fall through, leaving buyers and sellers frustrated and often out of pocket.
One of the most common reasons for a buyer pulling out is seen when the RICS building survey highlights issues that they weren’t previously aware of. The best way to avoid this happening is for sellers to be up front about any problems with the property and use this to negotiate on the price. Getting an RICS building survey will offer peace of mind.
Most house sales are part of a house-buying chain. Even if your buyers are committed, if their buyer pulls out or the house they are buying falls through, this affects the whole chain and has a domino effect.
In addition to getting a RICS building survey, having legal representation is essential when buying or selling a house due to the amount of money exchanging hands. Solicitors need to be thorough, and this can take time and cause delays that can subsequently make the process long and drawn out.
When accepting an offer, sellers should find out if the buyer’s mortgage is in place. If it’s not, sellers could take their property off the market only to find the buyer can’t actually afford it further down the line. This will result in the whole selling process having to start again.
Change of Circumstances
If 2020 has proved anything, it’s that life can be unpredictable, and this means people are facing an unexpected change in circumstances, such as a loss of income.
Lockdown and Brexit are just two examples of external influences that can cause buyers and sellers to change their mind. Maybe a move is too stressful, plans have changed, or children who had left home unexpectedly return. Sometimes, people just simply have a change of heart and decide to pull out of a sale based on instincts or timing.