Why do Oxford house sales fall through?

Selling a house is easy right?  The process is well known, proven and routine.  In fact, 2,844 Oxford homes were sold over the last 12 months.  So what’s the problem?

Well according to recent research, 38.8% of property sales fell through – the highest proportion for over 10 years.  For Oxford, that suggests that 1,803 house sale transactions failed to complete, contributing to the 13% year on year reduction in the total number of Oxford homes sold.

What is the reason for so many house sales failing?

The most significant reason is Buyers changing their mind or Oxford Sellers ‘pulling the plug’ because the process is too slow.  Combined these account for 46% of house sale failures.  A good estate agent will properly determine buyers commitment, financial viability and requirements.  A good agent will probe and challenge to enable them to accurately match each buyer with the properties they have available.  Equally, a good estate agent will devote time and effort each week to sales  progression, ensuring that delays are minimised, but ensuring that all parties are kept fully informed of progress.

It may be that we are starting to see the weakness of the low-cost, up-front fee model favoured by online agents.  Once their fee is secured, such agents have no incentive to properly register buyers nor in devoting expensive time and effort to sales progression.  Ultimately, buyers get what they pay for, and with close to half of all sales fall-throughs caused by these reasons, it seems clear that agents MUST devote more time to ensuring they have proceedable buyers and that the sales progresses effectively.

The second biggest cause of Oxford house sales failing to complete is either the buyer or seller wishing to renegotiate the price agreed. With a transaction as significant as a house purchase, it is inevitable that the buyer will want to pay the least possible and the seller will want to achieve the best possible price.  The estate agent has a role to play here too.  Both parties need to be properly informed of the market price that closely comparable properties have achieved, and when a buyer makes an offer, a good estate agent will be able to advise their client on whether the offer represents fair value in the context of the local market.

Over one in ten house sales fall-through because the house survey identifies one or more adverse findings.  For example, many homes in and around central Oxford have a heightened flood risk.  As a rule of thumb, the factors identified when the seller moved-in, will again be identified by the buyers’ advisors.  The more that can be proactively divulged the better to ensure that they will not result in the buyer withdrawing.  Better to know early than after 8 weeks of sales progression.

So far, so familiar.  However, c12% of Oxford house sale fall-throughs are a direct result of the tougher lending criteria imposed by legislation in the post-credit crunch world in which we live.  This is another area where a good estate agent will advise a buyer, helping them to understand the size of deposit and the likely income required to secure and support their mortgage.  The best agents have relationships with a range of specialists who can advise buyer in light of the new rules and regulations.

The final top reason for Oxford house sales to fall-through is the property purchase chain collapsing.  When a buyer has a property to sell, and the seller has offered on a property to move to, each part of the chain is reliant on the other parts.  Fewer Oxford homes are being advertised for sale, and that creates shortages of properties for buyer and sellers to move to.  Good estate agents understand the importance of building a relationship with the other agents in the chain to work together to hold a chain together benefitting all their clients.

Oxford house sellers should think carefully when selecting their preferred agent, evaluating their ability to assist with all aspects of the sales process ensuring that their sale is not one of the c40% that fail to complete.  Like moves things in life, you get what you pay for!