Expired property searches are delaying sales completions

More than 60% of property transactions could be at risk of delay because they take longer than six months to reach exchange, increasing the likelihood that property searches will need to be refreshed.

This is according to the latest analysis by property industry consultancy TwentyEA.

Most property searches are only valid for six months and lenders will typically not release mortgage funds once they have expired unless the searches are updated or suitable search indemnity insurance is put in place. 

With 60.8% of transactions exceeding the six-month mark, many buyers and sellers could therefore face additional costs and delays as searches need to be refreshed. 

This figure was 36% in 2019 and has risen to 60.8% so far this year. 

This means that of the properties that reach exchange, in these cases, the legal searches would have had to be repeated or refreshed, possibly resulting in delays. 

Nationally, TwentyCi found that buying a home now takes around a staggering seven months on average. In 2019, this was just 5.5 months. 

The analysis uses two periods of time to measure time to complete. 

The first period is the time taken to secure a buyer and reach a sale agreed (time to sell), the second measures the time taken to progress the agreed sale to exchange of contracts (time to exchange). Together, these metrics are the total time taken to complete.

Despite the increasing time required, the time to sell has remained relatively consistent. It currently takes around 2.5 months for a property to progress from being listed to a sale agreed, the same timescale as 2019.

However, the time taken to exchange contracts has increased considerably, from around three months in 2019 to nearly four and a half months in 2026.

The notable effects of longer transaction times are higher fall through rates and fewer transactions, with slower sales creating problems within chains, resulting in fewer overall purchases. 

TwentyEA director Nick Huntley says: “As part of the government’s reforms, they propose to initiate the preparation of upfront information, which will include property searches and, eventually, a property condition report. 

“These sales packs will need to be provided by sellers and estate agents at the point of listing rather than later in the process when the buyer instructs a conveyancer.

“These property details, provided to buyers and their advisers upfront, should enable faster, more informed decisions and reduce delays, fall throughs and any late surprises. What’s interesting is that these proposals will shift housing transactions from a buyer-led model to a front-loaded seller-led one.” 

The complete TwentyEA Property & Homemover report can be dowloaded here.

Kindly shared by EstateAgentTODAY image courtesy of Adobe