The number of property sales collapsing rose 10% in the second quarter of the year as buyers faced dramatically higher mortgage costs, according to new figures.
There were 69,940 so-called “fall throughs” in the three months to June according to data from property purchasing specialist, House Buyer Bureau. That was up from 63,446 in the first quarter.
The average cost of a failed sale during the second quarter was estimated at £3,394, making the total cost £237.4 million.
Managing director of House Buyer Bureau Chris Hodgkinson, said: “It was more or less inevitable that fall-throughs were due to climb this year and this increase has come at a considerable cost to the nation’s buyers and sellers at a time when finances are already stretched to breaking point.
“The market may have cooled in terms of transactional volumes, which has led to a reduction in fall throughs on an annual basis when compared to the heights of the pandemic boom.
“However, market conditions are uncertain, to say the least, and many buyers have struggled with the increasing cost of borrowing which has forced them to reassess their position within the market.
“This has been a driving force behind the uptick in sales collapsing during the second quarter of the year and the best way to bypass this property disappointment is to secure a cash buyer as the dangers of a fall through are dramatically reduced.”
Mortgage rates peaked in late July at 15-year highs, with average two-year deals carrying interest rates of close to 7% and typical five-year deals above 6.5%, according to Moneyfacts. But they have fallen back down to earth since, amid hopes that the Bank of England’s interest rate rises may have finally come to an end. Today, HSBC was the latest lended to cut its rates again.
