Interesting new research conducted by Market Financial Solutions has revealed the issue of would-be buyers and investors being pipped to their chosen property at the last moment.
The survey of 2,000 UK adults found that those in the capital were most likely to be beaten at the at the last minute when trying to complete a property purchase.
According to the study, 15% of adults in London-equivalent to in excess of 1 million people, have lost out on a purchase to a rival, after having an offer accepted!
This figure is three times greater than the average figure of 5% for the rest of the UK overall. 1.5million people in the country said that they had lost out on their ‘dream property’ due to a purchase falling through after their offer was approved.
These results highlight that competitive nature of London’s property market. The most recent Nationwide House Price Index indicates that the average property price in the capital is now £473,073-over twice the national average of £217,000.
What’s more, London is the second largest city in the world for foreign property investment. Over £18.8bn worth of the property was purchased by overseas buyers in the year to June 2016, according to Knight Frank’s Global Cities report.
This underlines the amount of buying power in London, and as such indicates that the likelihood of Londoners losing out on properties at the final moment.
Of course, being pipped to buying a property brings with it increased costs. 3% of UK adults questioned (1.54m people) claim they have been left out of pocket as a result intermediary fees being paid to solicitors and surveyors. This figure rises to 9% in London.
Research shows that would-be property purchasers lose an average of £2,889 in fees when their sale falls through. This means the total across the country is more than £4.4bn.
Paresh Raja, CEO of MFS, noted: ‘Most people who have dipped their toe into the property market will have felt the frustration of deals falling through at the last minute. Not only are people losing out on the fees they pay to solicitors and surveyors, but many buyers are also losing out on their dream home.’
‘The research reveals that delays in accessing the funds required to complete the deal are one of the most common reasons for a property purchase falling through. The statistics show that as mortgage lenders implement greater regulation, getting finance in a timely manner has become an increasingly pertinent challenge. This is one of the main reasons that the bridging industry has risen in popularity among property buyers and investors – in such a competitive industry, speed is everything and bridging provides a much-needed solution in this fast-paced market,’ Raja added.