New research has shown that 73% of buyers so far in 2022 have purchased their property in a chain-free transaction, an increase from 69% in 2021 and 65% in 2010.
The increase in chain-free transactions has stemmed from a rise in chain-free buyers, such as investors and first-time buyers. 2022 has seen first-time buyers purchase a record 26% of homes, a 2% rise from 2021 levels. Investors accounted for 14% of buyers – also a 2% rise.
With a shortage of properties on the market – a third less in Q1 2022 compared with Q1 2019, according to the study – sellers are increasingly looking to sell to a chain-free buyer so as to reduce the risk of the transaction falling through and them losing the property they are looking to buy.
The study, conducted by property research organisation Hamptons, shows 61% of sellers looked to accept an offer from a chain-free buyer instead of a buyer with their own home to sell. This is up from 58% in 2019. Buyers with a home to sell are waiting 111 days to exchange after having an offer accepted, yet chain-free buyers are exchanging after just 91 days – the biggest gap ever recorded by Hamptons. 80% of sellers accepted an offer from a chain-free buyer when said buyer matched the offer from a non-chain-free buyer, up from 60% in 2016. Sellers also accepted an average of 2.5% less from a chain-free buyer, showing just how desperate people are to avoid fall-throughs.
An increasing number of buyers are indeed chain-free. In 2021, 30% of buyers were selling their current home – this is now 27%. Owner-occupiers buying their next home in cash have also fallen 5% since 2020. The share of chain-free buyers fell in all areas of Great Britain except London and the North East.
Aneisha Beveridge, head of research at Hamptons, said:
“The current pace of the market has put buyers with a home to sell at the back of the queue. In a fast-paced market such as today, over three-quarters of sellers had multiple offers on the table to choose from. And given chain-free buyers tend to complete quicker and sales are less likely to fall through, they are fast becoming the preferred option for sellers.
However, chains serve an important role in the market, helping people move up and down the housing ladder. And it’s second and third steppers alongside downsizers who rely on the capital raised from the sale of their home for their next purchase who are finding it particularly tough. This is also exacerbating the lack of stock given their homes are increasingly being bought by first-time buyers and investors who do not have a property to sell.
Roughly speaking, for every 10 homes sold so far in 2022, only three of those buyers will bring a home onto the market to sell, creating a chain.”
