The home buying and selling process in England: Will Mandating Material Information Upfront Reduce Transaction Times and Failure Rates?

Helen Price, Danielle Sanderson and Peter McLennan

ERES from European Real Estate Society (ERES)

Abstract: The sale of residential real estate plays a significant role in the UK economy. In 2020 the economy benefitted on average by around £9,559 per transaction. An average of 1.25m transactions contributes nearly £12bn to GDP. 44% is directly attributed to the process, the largest proportion 33% arising from estate agent and conveyancing fees. 56% is generated after the sale of the property, from renovations, and household goods.Home buying and selling in England is widely acknowledged to be notoriously stressful. Consequently, since 1997, reform of the process has been high on various Governments’ agendas, without success. In 1998 it took on average 77 days to exchange contracts (offer to completion) and 28% of transactions failed. In 2022, despite advances in technology, it took even longer, 132 days to exchange and 38% of transactions failed.The 2018 resurgence has three main objectives: to improve customer service; speed up transactions; and reduce the number of transaction failures. Utilising previous Government research, this research investigates whether mandating information upfront will improve the process. The inclusion of a property condition report and reservation agreements will also be evaluated. Comparisons with other countries where the same shortcomings are not apparent will also be made.This research will use a mixed methodology to canvass the opinions of key actors and engage with consumers to record and comment on their journey through the process. The research will seek to demonstrate that the process and the dynamics of buying and selling are integrated. Buyers and sellers typically change homes simultaneously, so a “chain” is a characteristic of this “process.” It is important to evaluate the complete process and the associated dynamics when implementing changes.This research will develop a conceptual framework of the housing purchase decision-making process for the English system and focus on the psychological factors impacting mandating information. The research also explores the impact of the latter on listing price, lender’s valuation and sold price, as the time to complete as opposed to time on the market.This presentation will focus on the process, the causes of delay, and the theoretical framework.

Keywords: Completion Times; Failed Transactions; real estate; Residential Property (search for similar items in EconPapers)
JEL-codes: R3 (search for similar items in EconPapers)
Date: 2024-01-01
New Economics Papers: this item is included in nep-ure
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