An encouraging report indicates that conveyancing transactions reached their highest level in any second quarter since the recession.
The Conveyancing Market Tracker from Search Acumen indicates that the total number of transactions hit 230,430 between April and June of this year. This represented a rise from 219,613 during the second quarter of 2014, where changes in the Mortgage Market Review were found to have caused a temporary slowdown in activity.
On average, conveyancing firms enjoyed an 8% year-on-year increase in business during the second quarter of 2015.In addition, of the top firms growing at the quickest rate (10%) saw conveyancers in this bracket of the market handled 220 more transactions on average that in the same time-frame in 2014.
A strong performance in the second quarter of 2015 has seen the market start to recover from a poor start. Having been 5% down year-on-year at the end of the opening quarter, total transactions were just 0.3% down annually come the end of the first half of this year.
Analysis from Search Acumen indicates that the mix of lower house prices and record low mortgage rates has helped to aid the long-term recovery in transactions numbers. Over the past four years, activity has increased by 73%.
Q2 of 2015 also saw the first increase in the number of active conveyancing firms since Q3 of 2014, with an average of 20 more firms registering transactions per month in comparison to Q1. Additionally, with less businesses competing for work than four years ago, the typical firm has seen a larger increase in transactions, by 95% over the period.
Despite the top-five firms showing the greatest growth during the past year, the firms ranking between 51st-100th on the list have recorded the largest uplift since 2011. Q2 transactions are up by 114% in this particular part of the market.
In addition, the Tracker shows that dealing applications, which include the transfer of charges, notices and transfers, continue to make up the lions-share of activity. These features totalled 201,522 in the second quarter of the year, up by 4% on the same period in 2014. Also, there was a 46% annual growth in Dispositionary First Lease to 308 and an 18% rise of Transfers in Part to 23,409.
Together, the top 1,000 firms had a 72% market share for the second quarter in succession, a slight dip from the 73% recorded in Q4 of 2014, but up from 71% one year ago.
Q2 conveyancing transactions in post-recession high
‘Quarterly growth trends haven’t wowed the crowds so far this year, but after the disruption caused by changing mortgage regulations and the general election, conveyancing activity is back within touching distance of the levels seen in the first half of 2014,’ said Mark Riddick, Chairman of Search Acumen. ‘More importantly, our analysis shows those firms who have got their act together the most in the post-recession era have succeeded in out-performing the market, which has itself grown in leaps and bounds.’
Riddick also said, ‘Mark Carney’s latest hints of a possible interest rate rise may bring another boost to transactions as buyers look to expedite property purchases.’ He feels that there is, ‘still resounding evidence of pent-up demand: the National Association of Estate Agents suggests there are now ten buyers for every house on the UK market, so housing activity won’t stand still for long.’
Concluding, Mr Riddick commented that, ‘Conveyancers can look forward to a buoyant second half of the year, but the aggressive growth of those towards the top of the food chain should sound alarm bells for the competition. Having the resources to chase more business is only part of the recipe for success. Unless conveyancers have the processes to make best use of their assets and cope with an influx of customers, they will struggle to make the most of opportunities for growth. Those firms who are lagging at the midway point of 2015 and have ambitions to do better will need to think hard about why, and how to turn things round.’