Record Low Fall Throughs: Returning to Pre-Pandemic Levels
A recent industry index highlights a continued decline in property transaction collapses in the UK market during Q1 of this year, reaching the lowest quarterly level since Q1 2019. House Buyer Bureau examines these fall-throughs, including their average cost and the overall impact on the property market.
The latest data reveals a 2.1% increase in the average cost of a fall-through during Q1 2023 compared to Q4 2022, now averaging £3,370 per transaction. However, since September of the previous year, the housing market has cooled, witnessing reduced market activity from both buyers and sellers compared to the pandemic-induced surge.
The volume of collapsing transactions has significantly decreased, with an estimated 63,970 fall-throughs in the first three months of this year. This represents a 16% quarterly decline compared to Q4 2022, marking the second consecutive quarterly decrease following a peak of 90,188 fall-throughs in Q3 2022. Moreover, this figure signifies an 11% annual reduction, reaching the lowest level since Q1 2019 before the property market boom triggered by the pandemic.
The decline in fall-throughs has also led to a decrease in their total estimated cost to the market. Despite the rise in average individual costs, the total estimated cost of the 63,970 collapsed transactions in Q1 has dropped by 14% quarterly. Nonetheless, fall-throughs still resulted in £215.6m in costs for homebuyers and sellers during the first quarter of this year, representing the lowest quarterly total since Q4 2021.