Posted on May 11th, 2016 | Categories - News
New research has shown that an alarming number of property sales fall through each year, potentially costing homebuyers thousands of pounds in lost fees.
The research from LV= Legal Services found that:
- 27% of property sales in the past five years have fallen through
- Lawyers holding up the property buying process were to blame for 48% of all purchases which failed to complete, equivalent to 96,000 transactions in 2015
- Of the others, 21% of buyers were gazumped and in 15% of cases the buyer pulled out at the last minute
- The average time it takes for a purchase to reach exchange of contracts is three months
Having a property purchase fall through can be expensive, especially if the purchase collapses close to completion, when the buyer may have already paid for a survey, mortgage arrangement and broker fees, disbursements such as searches and of course legal costs.
Shop around for your legal advice
The survey also revealed that a third of homebuyers use the solicitor recommended by their estate agent. Alarmingly, a small percentage of homebuyers, (17%), are unaware that they can shop around for their lawyer or conveyancer.
However, those who use the solicitor recommended or affiliated to an estate agency, will pay more than buyers who shop around. The research found that the average cost of using the solicitor recommended by the estate agent was £1,595, compared to £1,167 for those people who shopped around; a difference of over £400.
Cost isn’t everything though, the survey also found that the main complaints about solicitors and conveyancers were poor communication (74%) and slow service (65%).
Again, estate agent recommended solicitors performed less well with 56% of homebuyers using the conveyancer recommended by their estate agent having to chase for updates, significantly higher than the 47% of those who selected their own conveyancer.
Commenting on the survey Martin Milliner, Claims Director of LV= General Insurance, said: “It’s clear that in many instances the conveyancing industry isn’t working for consumers and those who simply take their estate agent’s recommendation are most likely to pay the price.”