The UK property market experienced a financial impact of over £1bn due to property fall throughs in 2022, according to the latest industry index by property purchasing specialist, House Buyer Bureau.
Despite a 15.9% decrease in fall through volume and a 0.8% reduction in associated costs in Q4 2022, the total annual cost increased by 6.3% compared to 2021.
House Buyer Bureau’s Q4 2022 index reveals a silver lining in the cooling housing market, with 75,809 homebuyers and sellers affected by property sale collapses, marking a 15.9% drop from the previous quarter.
The average cost of a fall through also decreased by 0.8% to £3,311, leading to a total cost of nearly £251m for Q4 2022, a 16.6% reduction from the previous quarter.
Despite these quarterly reductions, the Q4 2022 fall through figures were still 16.9% higher annually, with an 11.4% increase in average cost and a 30.2% increase in total quarterly cost compared to Q4 2021.
Throughout 2022, the total cost of fall throughs for UK homebuyers and sellers reached over £1.03bn, representing a 6.3% increase from 2021 and a 75% increase since 2018. This marks the fifth consecutive year of growth in this figure.
Chris Hodgkinson, managing director of House Buyer Bureau, said: “There’s no denying that the market has now started to cool and while this may bring its own concerns, a reduction in both sales volumes and house prices during the final stages of last year has, at least, seen a drop in the number of transactions that are collapsing on a quarterly basis, as well as a reduction in the cost incurred by buyers and sellers.
“There is, of course, a seasonal element at play here as well, with the final months of the year traditionally bringing a lull in market activity.”
However, Hodgkinson also highlighted the continued increase in total costs for 2022, surpassing the £1bn mark. With predictions of a stable market in Q1 2023, there is potential for a reversal of the downward trend in fall throughs as market activity picks up.
Additionally, the cost-of-living crisis and rising borrowing costs could contribute to further market volatility.
