Conveyancers experience first annual drop in workload in six years
After six years of continued growth in activity, conveyancers experienced a drop in case volumes in 2017 according to Search Acumen’s Q4 2017 Conveyancing Market Tracker.
- Conveyancing volumes shrunk by 12% last year – from 1,077,959 in 2016 to 952,966 in 2017 – the first annual drop in workloads since 2011, reflecting a subdued property market
- The average firm completed 171 transactions in 2017, down 11% on 2016 and down 1% from a decade ago
- The number of active firms in the market remained steady in 2017, dropping less than 1% year-on-year but still down 28% since 2007
- The top 1,000 firms held 72% of the market, up by one percentage point from 2016 while the top five maintained their 6% market share
This annual decline saw conveyancing volumes shrink by 12% last year – from 1,077,959 in 2016 to 952,966 in 2017 – as the stagnant UK property market weighed down on conveyancers.
Despite this, the number of active firms in the market remained steady in 2017, dropping less than 1% year-on-year. Firms in operation have nevertheless dropped 28% over the past ten years – from 7,733 to 5,559 – as fewer conveyancers deal with a higher volume of transactions over the past decade.
Stagnated UK property market hits conveyancers
During a testing year for the UK property market, conveyancing firms have been fed a lower volume of transactions, resulting in the average caseload dropping across the sector.
The Search Acumen Conveyancing Market Tracker – which uses HM Land Registry data to examine competitive pressures in the conveyancing market – shows the average firm completed 171 transactions in 2017, down 11% on 2016 when the total sat at 193 per active firm. This figure has dropped 1% since 2007, when conveyancing firms averaged 173 cases per year.
Volumes hit across the board
The decrease in conveyancing volumes in 2017 was felt across a majority of the market. The top five firms suffered a 9% drop in average monthly volumes (from 1005 to 918), while all firms in the top 1000 experienced a 10% decline. Meanwhile, the only categories that saw an uptick in volumes throughout the year were occasional conveyancers – those completing between one and ten transactions per month.
Throughout the year, top five firms on transaction volumes completed 11,010 transactions on average, dropping by 9% year-on-year from 12,056. Categories of firms within the top 1000 all witnessed drops in average monthly volumes in 2017 as the property market lulled.
Competition in the market remained almost stationary in 2017, compared with the previous year. Throughout the year, the top 1,000 firms held 72% of the market – up by one percentage point from 2016 – while the top five kept 6% of the market. In percentage terms, the top five firms have seen their market share double since 2007 (3%), while those outside the top 1000 have experienced a drop from 43% to 28%.
Among different types of transactions, Dispositionary First Lease transactions saw the highest increase in volumes for the second year running, rising by 29% over the year from 2,208 to 2,857. Meanwhile, Dealings and Transfer of Part transactions saw a 13% and 6% annual drop respectively. On a quarterly basis, Dealings suffered the largest drop in volumes (-13%), while Dispositionary First Lease transactions saw the largest increase, rising 29% in Q4 2017.
Andrew Lloyd, Managing Director of Search Acumen said:
“2017 was another year of uncertainty in the property market, and conveyancers are feeling the impact of a housing sector in need of a jumpstart. The Market Tracker has revealed a downward shift in transaction volumes for the first time in six years. Despite these odds however, the market remains resilient and the number of operating conveyancers has not yet felt downward pressure.
“At the beginning of the year, the Prime Minister vowed that UK housing was to be an area of absolute focus for the current government, and policies like the abolishment of SDLT for first-time buyers will undoubtedly reduce the chasm between young market hopefuls and established homeowners. However, housebuilding activity fell last month for the first time since the EU referendum. The property industry continues to be frustrated with the inertia it finds itself in, fuelled by bureaucracy, politicking and set-backs.
“The next twelve months will be full of challenges for conveyancers while the housing market tries find its feet again. We must operate with absolute efficiency to ensure we are prepared for a recovery in property transactions, embracing technology to create a transparent, productive offering which works for everyone. This is the only way we can ensure the conveyancing market effectively adapts to whatever the property market feeds it.”
Kindly shared by Search Acumen