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Two thirds of property buyers and sellers see deal fall through in last 12 months

gazumping

Two in three property buyers and sellers have been involved in a deal that has fallen through in the last 12 months, according to new research.

A survey by reallymoving showed the main reason for failed transactions was buyers and sellers changing their minds (29%). This was followed by a problem discovered on the survey (17%) and difficulties obtaining mortgage finance (15%).

Issues within the property chain (11%), as well as gazundering (8%) and gazumping (7%), emerged as other common reasons for deals falling through.

The findings come after the Government proposed the introduction of Reservation Agreements last month. Reservation Agreements would make buyers and sellers financially commit to a deal at the point of an offering being agreed, which seek to would reduce the chances of transactions breaking down.

Two thirds (67%) of the property buyers and sellers surveyed said they were in favour of the touted Reservation Agreements.

“The system for buying and selling property in England and Wales is fundamentally unfair, requiring both buyers and sellers to commit considerable sums of money to a process in which they are entirely unprotected,” said Rob Houghton, CEO of reallymoving.

“Reservation Agreements, which would require both sides to part with a lump sum of cash at the point an offer is agreed, would undoubtedly prompt people to think hard about their commitment to the process, which can only be a good thing. The devil will be in the detail however and there will need to be clear guidelines outlining what exactly constitutes a genuine reason for withdrawing from a sale.”

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