Given a quarter of prospective sales fell through last year, this house buying nightmare is more common than you’d think.
Despite post-lockdown house prices reaching record highs, there’s always a risk a sale will fall through before completion – now more than ever during turbulent financial times.
‘With the housing industry seeing an unusual amount of activity in the wake of the stamp duty holiday and the end of coronavirus lockdown measures, there’s still a risk of sales falling through’ explains Paran Singh, financial advisor at TIC Finance.
‘People back out of house purchases for a whole range of reasons – a quarter of prospective sales fell through in 2019.’ Here he offers his essential tips to help house sellers recover from a sale falling through – and how to avoid the situation in the future.
Advice: For sellers if a house sale falls through
1. Don’t rush
‘Feeling increased time pressure could result in unnecessary monetary losses. It’s much more beneficial to hold out for a buyer a little longer before dropping the price below the value’ Paran advises.
2. Ask for proof of finances early
‘Before accepting an offer, make sure to ask for proof of finances. For example, bank statements or an agreement in principle to avoid sales falling off.’
3. Ensure regular communication
‘Keeping in touch with buyers and their solicitors will help you spot the signs of a fall-through early and will help you plan your onward move.’
4. Communicate with your chain
‘As well as regular updates with your buyer, keeping in close contact with the other parties in your onward chain will help to manage their expectations. And keep the process as stable as possible while you find a new buyer.’
5. Ask for a non-refundable deposit from future buyers
‘This could be a small deposit of a hundred pounds to act as a holding fee. Giving you added security and ensuring your buyer is serious about completing the purchase.’
6. Review pricing
‘While it’s not always necessary to reduce your asking price immediately, rising house prices could lead to over-valuing your property. Which could cause issues with your buyer’s lender.’
7. Search for more than one potential buyer
‘If another buyer isn’t willing to commit to a holding fee or you spot another sign of the sale falling through. Continuing viewings will help to keep interest high should anything not go to plan.’
8. Complete your own survey
‘Many property sales fall through because of something revealed in the survey. Carrying out your own survey can help you resolve issues and give prospective buyers a better understanding of the quality of the property.’
‘While we may be enjoying a busy period of house sales, encountering complications within the sale chain can be immensely stressful and disruptive for all involved’ he remarks. ‘It’s important to work with the people around you to ensure everybody can reach a satisfactory conclusion as quickly as possible.’
Industry experts are all speculating about the prospect of a bust following the current housing boom. So this information could be essential to help sellers who have lost their buyer.