Transaction time

Transaction times up 47% in last 15 years

“Innovation has simply failed to keep pace with demand” – new data from Landmark Information Group shows that the completion time on the purchase of a new home now takes over a month longer than it did 15 years ago.

In 2007, the average transaction for UK homebuyers took 83 days from instruction to completion. Now, the average sits at 122 days – an increase of nearly 47%. This comes as no surprise given that the average time on the market for a property over the last six months sits at 248 days, a figure which is relatively low compared to the 306-day wait of the previous six months.

Simon Brown, CEO, Landmark Information Group, puts the exponential increase down to several factors:

“There is no single part of the market responsible for this increased delay; innovation has simply failed to keep pace with demand over the years and incremental delays at each point have added up to create a much bigger problem for home movers.”

Brown believes that a combination of tight regulations and dwindling workforces have made delays inevitable:

“Along with this slow pace of innovation, tighter regulations and higher demand have left property industry employees across the board with much greater workloads. From a lender perspective for instance, the 2014 Mortgage Market Review created a number of extra checks and balances on every mortgage application.

From a conveyancing standpoint, ever-tightening fee margins over the years has left the industry with a dwindling workforce – a problem magnified by the housing market shutdown. This smaller workforce has also been battling with increasingly heftier compliance obligations, such as robust client identity and funds validation requirements. On top of this, the type and amount of additional enquiries lawyers are receiving continues to grow as frustrated home-movers look for answers to these stressful delays.

Of course, any external pressures that stimulate the market – such as the Government’s introduction of a Stamp Duty Holiday in 2020, or a second home tax discount in 2013 – result in any inefficiencies being exacerbated and transaction times getting longer.”

Any solution to the problem will need to come from all parties within the industry, warns Brown. The recent action taken on the industry’s strong demand for upfront information will therefore come as welcome news. He also calls for improved automation and integration, something that will no doubt continue to be an area of sustained development within the conveyancing industry. Brown said:

“This is a cross-industry problem, that warrants a cross-industry solution, with everyone from estate agents, to mortgage lenders, to conveyancers having their part to play in making the market work better for home-movers. Waiting 122 days causes a huge amount of anxiety and frustration for consumers – we need greater automation, integration, and coordination throughout the different parts of the process to revolutionise the transaction journey for movers.”

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