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Quick Move Now Fall Through Index

Tuesday, 11 November 2008

Aborted Sales Fall Below 40%

On average 39% of sales aborted during the last 6 months.

This is the first time in 14 months that the Quick Move fall through index has been below 40%
Does this mean we have reached the bottom of the market?

The last few months have seen wildly fluctuating market sentiment. On the positive side interest rates have fallen and stamp duty was removed on transactions up to £175,000 holiday. While on the negative side the UK economy entered a recession with continued falls in house prices and high deposits required for mortgages.

There should be a steady improvement in fall through rate once the market has bottomed out leaving those with secure finance no reason not to proceed with purchase. However it doesn’t look like we’ve reached that stage yet.

Until we see price falls slow or stop we will continue to see high levels of aborted sales. And unfortunately as repossessions and unemployment increase and the recession starts to hit home buyers pockets we expect prices falls to continue well into 2009.

Although monthly figures shouldn’t be considered in isolation last month saw nearly 50% of agreed sales fall through which would indicate we aren’t out of the woods yet. While the market finds its feet we are unlikely to find a prolonged substantial improvement to the FTI until later in 2009.