Britons lose £1.5bn a 12 months in failed home buys as authorities urged to repair ‘antiquated’ system

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Your assist makes all of the distinction. Learn extra Home gross sales that fall by are costing the economic system not less than £1.5 billion per 12 months, in line with a report for a significant financial institution.

The financial institution went on to label the home-buying course of as “antiquated”, including that greater than half 1,000,000 failed transactions a 12 months throughout England and Wales are costing customers about £560 million straight and a £950 million hit to the broader economic system.

Santender’s Fixing the Damaged Chain housing report indicated that just about 1 / 4 (23 per cent) of individuals stated that they had tried to purchase a property, just for that course of to fall by.

The report stated: “For most individuals, shopping for a home is their largest monetary dedication.

“The method because it stands merely doesn't replicate that. In an period that's marked by digitisation and ease for therefore many areas of day-to-day life, the property market stands out like a sore thumb.”

Within the report, David Morris, head of properties at Santander UK, stated: “Our conservative calculation reveals that £1.5bn a 12 months is misplaced within the economic system and by customers from failed property transactions.”

<img src="https://static.independent.co.uk/2025/08/06/00/1d09156c0fefbc6614ed407916c3045cY29udGVudHNlYXJjaGFwaSwxNzU0Mzg1NDcx-2.38488394.jpg" srcset="https://static.independent.co.uk/2025/08/06/00/1d09156c0fefbc6614ed407916c3045cY29udGVudHNlYXJjaGFwaSwxNzU0Mzg1NDcx-2.38488394.jpg?quality=75&width=320&auto=webp 320w, https://static.independent.co.uk/2025/08/06/00/1d09156c0fefbc6614ed407916c3045cY29udGVudHNlYXJjaGFwaSwxNzU0Mzg1NDcx-2.38488394.jpg?quality=75&width=640&auto=webp 640w" loading="lazy" alt="Nearly a quarter of people said they had tried to buy a property, only for that process to fall through" class="sc-1mc30lb-0 ggpMaE inline-gallery-btn"/> open picture in gallery

Practically 1 / 4 of individuals stated that they had tried to purchase a property, just for that course of to fall by (PA) The analysis was based mostly on financial evaluation from WPI Economics, in addition to a survey of greater than 2,300 customers by JL Companions carried out in July.

It estimated that about 530,000 housing transactions fail annually in England and Wales.

The financial evaluation indicated that the direct value to customers of this by spending that can not be clawed again, corresponding to mortgage and solicitors’ charges, is £560 million yearly.

The overwhelming majority (85 per cent) of people that skilled a failed transaction reported a monetary loss, researchers discovered. The common value was £1,240 per failed current transaction.

The analysis indicated that 17 per cent of unsuccessful transactions collapsed after one month, whereas 43 per cent of failed transactions occur at or past the three-month mark.

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Researchers additionally highlighted impacts on the broader economic system of failed transactions, such because the outing of the office that folks have taken whereas attempting to finish transactions, and the price of decreased wellbeing and leisure time that had been wasted.

A typical purchaser who reported losing time estimated they spent 100 hours participating in actions associated to a failed transaction, the report discovered.

The bulk (almost 60 per cent) of these actions have been taken throughout common work hours, which was time that would have in any other case been spent being economically productive, it added.

Some individuals stated the shopping for expertise would make them much less more likely to transfer once more.

The affect of individuals dwelling in housing which is now not appropriate for his or her wants consists of things like decreasing workforce mobility, fewer bigger properties for rising households and slowing housing chains, the report stated.

To assist forestall gross sales falling by, Santander needs to see gazumping, the place a vendor accepts one other larger provide on their residence after beforehand verbally agreeing a deal, and gazundering, the place a purchaser reduces their provide on the final minute, disincentivised.

The financial institution additionally needs to see higher up-front collation of knowledge from these concerned in transactions.

The report stated: “On the entrance finish of the method in Australia, presents are sometimes legally binding as contracts are signed very shortly after the vendor has accepted, giving extra safety and safety from gazumping.

“Scotland, Spain and america additionally present some type of certainty.

“Within the Scottish system, presents are legally binding. That is made potential by enhanced disclosure up-front.”

Santander can be calling for a centralised property knowledge system, and better use of AI (synthetic intelligence).

<img src="https://static.independent.co.uk/2025/08/31/22/fc9318e4c79bf277f44fe70f19bb6d25Y29udGVudHNlYXJjaGFwaSwxNzU2NzM3NTY2-2.81085250.jpg" srcset="https://static.independent.co.uk/2025/08/31/22/fc9318e4c79bf277f44fe70f19bb6d25Y29udGVudHNlYXJjaGFwaSwxNzU2NzM3NTY2-2.81085250.jpg?quality=75&width=320&auto=webp 320w, https://static.independent.co.uk/2025/08/31/22/fc9318e4c79bf277f44fe70f19bb6d25Y29udGVudHNlYXJjaGFwaSwxNzU2NzM3NTY2-2.81085250.jpg?quality=75&width=640&auto=webp 640w" loading="lazy" alt="A major bank has called for a centralised property data system, and greater use of AI" class="sc-1mc30lb-0 ggpMaE inline-gallery-btn"/> open picture in gallery

A significant financial institution has referred to as for a centralised property knowledge system, and better use of AI (PA) The report stated: “Growing the usage of AI throughout the transaction course of would create a extra seamless journey for all.

“Automating administration duties removes the burden from conveyancers and lenders, releasing up time to spend on the weather of transactions that require their experience and supply essentially the most worth for purchasers.”

Mr Morris stated: “Shopping for a house must be a second of pleasure and hope, however for too many individuals it’s an unsure and exhausting course of, that drains their psychological, emotional and bodily well being.

“The house-buying journey remains to be working within the confines of a framework that was established a century in the past.

“This antiquated system is an more and more heavy anchor weighing on the economic system and fixing it have to be key.

“Whereas the federal government has put the housing market firmly on its agenda, as this analysis reveals, the dimensions of the problem stays largely underappreciated, and that’s why we’re calling for highly effective reforms to provide patrons and sellers extra confidence, ease the monetary and emotional pressure and create a housing system match for the wants of immediately’s customers and economic system.”

A Ministry of Housing, Communities and Native Authorities (MHCLG) spokesperson stated: “It's far too expensive and anxious to purchase and promote a house.

“We’re decided to revive the dream of homeownership to those that discover themselves locked exterior of the system.

“We're already taking steps to digitise the house shopping for and promoting system and can proceed to prioritise that work.”

In February, the federal government introduced tasks to replace the method, together with frequent knowledge requirements so data could be shared extra simply.

It plans to proceed to work with organisations, together with additional potential issues for bettering up-front data sharing and stopping gazumping and gazundering.

Henry Jordan, Nationwide Constructing Society’s group director of mortgages, stated: “Shopping for a house is usually complicated and anxious, which is why the home-buying course of must be simplified and streamlined for the advantage of customers, brokers and lenders.

“However to sort out this subject successfully, we should collaborate.

“Because of this we wish to work intently with authorities and the broader trade to efficiently reform home-buying within the UK.

“Digitalisation and know-how are a significant a part of how we'll get there – the current launch of our property lending test function with Rightmove to assist pace up transactions reveals how we're making regular progress.”