Perhaps you remember a time when purchasing a property just seemed simpler? Way back in 1994, even leasehold apartments would complete inside of 6 weeks.
Right now, the average time to sell and complete on the sale of a property is over six months, never mind six weeks, and we thought it would be interesting to assess how the current pandemic has affected the time it takes to sell a property.
When we do this analysis, we will refer to two phrases which will have the following meanings:
- Time to Sell – by which we mean the time in days it takes to get a sale agreed on your property from initially instructing an estate agent to sell it.
Time to Complete – by which we mean the time in days it takes to get a property from a sale agreed to actually owning it and moving in.
Time to Sell
The following charts what has happened to the average time to sell a property in the UK since Q1 2019…
You can clearly see from the chart that Q2 2020, where the property market was locked down for a significant portion of this quarter, had an issue. On average, it took 94 days (over 13 weeks) to sell a property in this climate. This was an increase of over 31% when compared to the same quarter in the prior year.
However, what we can now see is that the Time to Sell metric has reverted towards the mean and now stands at 77 days. This is still 7% higher than the same quarter in the prior year and we believe that most of this increase is down to the mix in property types that are selling (larger and more detached) which traditionally take slightly longer to sell.
In summary, the Time to Sell a property in the UK is currently at or near expected levels from 2019.
If you think this is “problem solved”…
Time to Complete
The following charts what has happened to the average time to complete on a property from sale agreed in the UK since Q1 2019…
Q2 2020 is where we see the real impact of the pandemic on property completions. The average time taken to complete a property in Q2 2020 was 126 days (for just over 18 weeks). This was 21% higher than the equivalent time in Q2 2019.
The issue here is what happened in Q3 2020 where the Time to Complete came back down by only three days on the prior quarter. It is still 15% higher than the equivalent time in Q3 2019.
So why is it currently taking almost three weeks longer to complete on a property than it did last year? There are a few reasons as to why this could be the case, all of which would typically revolve around an increase in or backlog of cases either for Local Authorities to complete searches or Conveyancers completing cases or Surveyors completing valuations or even Banks slowing down access to lending.
We don’t have the data to show which of these is having the biggest impact but what we would say is that longer delays lead to more fall throughs and more fall throughs lead to fewer completions. These actual sales are important to all of us as the benefits to the economy are substantial – both directly to the property industry and indirectly through the massive retail spend for which homemovers are responsible.