New data from the UK’s leading residential property buyer suggests a major rise in misplaced confidence among homebuyers in the market.
Quick Move Now’s Fall-Through Index (FTI) now stands at 29%, showing that close to a third of potential buyers are unable to complete a purchase, usually due to a lack of mortgage finance. The FTI now stands at the highest level since mid-2012.
Donna Houguez, Market Analyst at Quick Move Now, commented:
This index is a measure of misplaced confidence – people who make an offer and then fail to complete, often due to lack of mortgage finance.
What we saw in 2007/8 was a dramatic rise because the banks suddenly stopped lending but buyers took time to adjust. Since then, the FTI’s trend has been downwards but today’s figures reflect that buyers are re-entering the market in droves, keen to get in on the action because prices are rising fast.
However, the return of 95% mortgages driven by Help to Buy seems to have made many of them over-confident, leading to offers being made before an in-principle mortgage agreement is agreed. This has resulted in a rising number of deals falling through.
On the plus side, it’s good to see a rise in confidence in the market. On the down side, this measure shows much of that confidence is still misplaced.
Data calculation: Quick Move Now sells hundreds of properties each year and the fall through statistics are calculated month-on-month using a six-month average. In reality, the fall through rate for homeowners would be approximately 10 – 15% higher as Quick Move Now has a professional resale team proactively managing the completion process
- Quick Move Now provides data to a wide range of property market analysts, including the Bank of England
- Founded in 1998, Quick Move Now is the UK’s leading buyer of residential property, offering a quick, secure and hassle-free house sale. Our experienced team, efficient processes and substantial cash reserves allow us to make immediate purchases, enabling vendors to sell your houses quickly and move on with their lives