What to do if your house buyer pulls out

When a house buyer pulls out before exchange, it can be costly and incredibly stressful. Unfortunately, failed sales are more common than you may think. In the first 3 months of 2024, 31% of house sales fell through before completion in England and Wales.

This guide will help to explain why property sales fail and what to do if your buyer pulls out before exchange.

What can you do if your house buyer pulls out before exchange?

Unfortunately, if you haven’t yet exchanged contracts, there isn’t a huge amount you can do from a legal perspective.

In England and Wales, neither the buyer nor the seller has any obligation to complete the sale until contracts have been exchanged.

Having said that, it is worth contacting your estate agent or solicitor to find out why the buyer pulled out. Out of courtesy they will usually try to explain their decision. If your buyer is pulling out of the sale as a result of something that was brought up in the property survey, you may be able to get the sale back on track by agreeing to carry out necessary work to the property before the sale completes. Alternatively, you may be able to negotiate a price reduction.

If your buyer is adamant that their decision is final, your best bet is to get your property back on the market as soon as possible and try to secure another buyer. Although having a buyer pulling out of a house sale is frustrating, it is unfortunately not unusual.

It is worth noting that things work a little differently in Scotland. Generally, significantly fewer property sales fall through in Scotland. This is due to several factors:

• Sellers must pay to have a home report done before marketing their property. This means the process only tends to attract serious sellers who are committed to the process.
• The home report means potential buyers are well-informed before making an offer on the property. Because of this, there are likely to be fewer surprises during the house buying process.
• Properties are usually fully withdrawn from the market once an offer has been accepted, to discourage gazumping. If the seller does pull out of the process to accept another offer, they cannot use the same solicitor for the new sale. This tends to discourage sellers from pulling out of property sales.

When can a buyer pull out of a house sale?

A buyer can pull out of a house sale without any legal or financial recourse right up to the point of exchanging contracts.

Can buyers pull out after exchange?

A buyer can pull out of a house sale after contracts have been exchanged, but there are legal and financial consequences to this. If a buyer pulls out of a house sale after contracts have been exchanged, they will forfeit their deposit and may be liable for other costs incurred by the seller.

Why has my buyer pulled out of the sale? 

A buyer might pull out of a property sale for a variety of reasons, such as:

Unable to secure a mortgage

Even if they have successfully secured an agreement in principle before making an offer on the property, there will be circumstances in which a buyer is unable to secure a mortgage offer.  During times of market uncertainty, mortgage lenders may be more cautious about property values. If a mortgage lender values your property at less than the agreed purchase price, your buyer may find that there is a financial shortfall they simply cannot make up. Or they may, unfortunately, have a change in personal circumstances that mean they are no longer able to secure the mortgage they require to purchase the property

Unhappy with survey findings

Property surveys look at several different aspects of a property. Any areas of concern highlighted by a survey could make buyers cautious about proceeding. .

Some issues commonly identified as part of a property survey include:

• Damp in the property
• Structural movement
• Asbestos
• Roof problems
• Property changes that have been made without the relevant building regulations or planning permission
• Concerns about the property’s electrical safety

Failed attempt to renegotiate price

If the property survey identifies any areas for concern, the buyer may attempt to renegotiate the price. If you’ are not happy to lower the price to a level they deem appropriate’re unable to find a mutually agreeable price, the buyer may pull out of the sale.

Slow progress in property chain

Most home sales will be part of a property chain. The more links in the chain, the more complicated the property transaction will be. This means it will be more vulnerable to chain collapse.

A property chain can also cause significant delays in the house purchasing process. This can jeopardise the success of the sale.

Buyer simply changed their mind

From time to time, a buyer will simply get cold feet and change their minds about a property.

How many buyers pull out after survey?

Last year, 49% of failed sales were attributed to the buyer changing their mind, attempting to renegotiate or pulling out after the property survey.

My house buyer has pulled out – how much will it cost me?

Research from the HomeOwners Alliance suggests that 51% of sellers lost an average of £2,700 when a sale fell through before completion. A further 12% of sellers lost more than £5,000, as a result of a failed sale.

How to reduce the risk of buyer pulling out before exchange

When a buyer pulls out of a house sale it costs you time and money. It also causes a great deal of stress.

Unfortunately, a buyer pulling out of a sale is not unusual. There are, however, some steps you can take to help minimise your risk of a failed sale.

Research your potential buyers before accepting an offer

When presenting you with an offer, your estate agent should give you a summary of the potential buyer’s circumstances. Are they a first-time buyer? Are they part of a property chain? Do they have a strong need to move, eg. work, to be close to family, relationship breakdown etc. If you receive multiple offers, this information will help you choose between them. If you only receive the one, it will help you to be aware of any potential risk factors.

Try to minimise the number of links in the chain

Property chains make the house selling process slower and more fragile. The more links within a property chain, the more vulnerable the chain will be to collapse. For this reason, a chain-free buyer may be a better prospect than a buyer in a chain. This can be the case even if they make a slightly lower offer.

Be proactive in progressing the sale

When selling a property, it is important that you do everything you can to be proactive in progressing the sale. Ensure you have collated any paperwork relating to the property prior to the sale. It’s also important to have your solicitor lined up ready and, if you’re buying another property, ensure you have your mortgage in principle in place.

Once an offer has been accepted, stay in regular contact with your estate agent and solicitor. This will help ensure the sale is progressing well and respond to any queries in a timely manner.

If the survey highlights any areas of concern, be prepared to negotiate

Having to find a new buyer will cost you time and money, and could see you missing out on your next home. If the property survey raises concerns, keep lines of communication open and see whether the situation can be resolved. You may be able to keep your buyer by agreeing to get certain work carried out before exchange of contracts, or offering a slight price reduction to compensate for the buyer getting the work done after the sale completes.

Similarly, if your buyer’s mortgage lender down-values your property, seek a solution

If your buyer’s mortgage lender values your property at less than the agreed purchase price, and your buyer has no way of making up the financial shortfall, they may have to pull out of the sale. Should you find yourself in this situation, you may want to consider agreeing to lower the purchase price in order to keep your buyer.

If one mortgage lender down-values your property, other may too. Should you decide to stick to your guns and refuse to the lower the price, you could find yourself in a similar position with a new buyer several months from now. The time delay caused by having to find a new buyer may also jeopardise your onward move.

Save your property sale by using a cash home buying company

If your buyer has pulled out and you’re concerned about losing out on your next home, you could consider using a home buying company. A home buying company will pay less than market value for your property, but is able to offer a speed and certainty that cannot be matched when selling on the open market.  For more information about how a home buying company could help make your move quick, easy and completely hassle-free, read ‘how it works’ here.

Here at Quick Move Now, we have been buying properties since 1998. As the UK’s original and largest property buying company, we can buy any property in as little as 7 days.

To get a free, no-obligation cash offer fill out our online form or call us on 0800 068 3366 today!

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