Home sellers in the UK lose more than £400m in each year due to buyers ditching deals last minute, research revealed today, with 65 per cent of adults backing non-refundable deposits to commit both sides earlier in the process.
The survey was conducted by HomeOwnersAlliance, IMMO.co.uk and polling firm YouGov. It found that more than 300,000 property transactions collapse due to broken chains, costing 51 per cent of affected sellers more than £2,700 in the UK.
One in 10 sellers incurred more than £5,000, according to the survey.
It also showed 20 per cent of sellers have suffered a sale collapse.
The survey identified “gazundering” - the process of the buyer lowering their offering just before the exchange of contracts - as a major factor undermining home sales.
The survey said eight per cent of broken sales occurred as a result of gazundering.
As a result, almost two thirds (65 per cent) of adults in the UK support the idea of a reservation agreement requiring buyers and sellers to put down a non-refundable deposit to commit both sides earlier in the process.
Some 34 per cent of homeowners say risks of property chains breaking down and 19 per cent of homeowners say uncertainty regarding the sale price they may get for their property might prevent them from selling.
The research comes as the UK government recently announced measures to improve home buy and selling. One main measure was the introduction of voluntary reservation agreements.
Voluntary reservation agreements are are a non-refundable deposit to commit both sides earlier in the process.
HomeOwners Alliance chief executive Paula Higgins said: “We often hear about would-be buyers losing their dream homes as a result of sellers accepting higher offers but less is said about sellers forking out thousands in wasted fees only for buyers to change their mind, leaving the seller back at square one”.
“Gazundering and time wasting is a huge problem. The homeselling system is so unreliable it’s deterring homeowners from selling – adding to the ongoing housing shortage crisis as a lack of suitable homes is one of the barriers to people moving up the property ladder.”
Samantha Kempe, co-founder of IMMO.co.uk, said: “Sellers should be able to proceed with the sale of their property knowing what price they will receive and feeling assured that the sale will go through.”