Almost half of homesellers hit by broken chains
The latest research from House Buyer Bureau has revealed that almost half of home sellers who form part of a property chain have seen that chain break during the sales process, with buyers changing their minds and pulling out by far the most common reason why.
House Buyer Bureau commissioned an independent survey of 1,072 UK home sellers, asking about their experiences when selling their most recent property, whether they formed part of a property chain, the frequency and causes of chain breaks, and the financial and practical consequences that followed.
The research found that 52% of sellers formed part of a property chain when selling their most recent home and, of these, 45% experienced a chain break at some point during their sale.
For 38%, a buyer or seller dropped out but the chain was eventually restored or saved. However, 7% saw their chain break down completely.
Buyer indecision the biggest problem
By far the most common reason behind a chain break was a buyer simply changing their mind and pulling out, accounting for 60% of cases.
This puts buyer indecision well ahead of more practical obstacles such as mortgage or financing problems (8%), or a seller changing their mind (8%).
Property surveys identifying problems accounted for 6% of chain breaks, whilst delays within the conveyancing or legal process and changing personal circumstances were each responsible for 4%.
Gazumping accounted for just 2%, whilst mortgage lender down-valuations were responsible for only 1%.
Chain breaks cause months of delays
Even when a property chain can be rescued, the disruption caused can have significant consequences for those involved.
More than a third (36%) of those impacted by a chain break saw their property sale delayed, whilst 24% experienced delays to their onward purchase.
A further 10% saw their sale fall through altogether, 10% lost money on legal, survey or mortgage costs, and 10% were forced to find another buyer.
For those eventually able to complete following a chain break, getting their move back on track was rarely a quick process.
Just 7% completed within a month, with 29% taking between one and three months. The largest proportion, 38%, waited between four and six months, whilst 21% took between seven and 12 months and a further 5% waited more than a year.
Managing Director of House Buyer Bureau, Chris Hodgkinson, commented:
“Property chains have always been one of the weakest links within the traditional sales process, but what’s particularly concerning is that buyer indecision is causing far more problems than mortgages, surveys or the legal process.
A buyer can seemingly be committed to a purchase and then simply change their mind, and because one transaction is often reliant on several others completing successfully, that single decision can bring an entire chain crashing down.
For sellers, the consequences can be substantial. They may lose the property they’re trying to purchase, incur additional legal or mortgage costs and, even when the chain can eventually be repaired, find themselves waiting another four, six or even 12 months before finally completing.
This is particularly problematic in the current market. Buyers have become more cautious and considered in their decision making and, with greater choice available to them, sellers simply don’t have the same level of certainty that an accepted offer will actually translate into a completed transaction.
Unfortunately, there’s very little a seller can do to prevent somebody further down the chain from changing their mind and that’s precisely why chain-free buyers are so attractive.
For homeowners who simply can’t afford to risk their move collapsing, whether because of an onward purchase, financial pressures or a change in personal circumstances, removing the chain altogether and securing a guaranteed sale can provide a level of speed and certainty that the traditional market simply can’t.”
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