Fall throughs on the rise, costing buyers and sellers:- £240m in Q2 2023

THE latest industry index on property fall throughs by property purchasing specialist, House Buyer Bureau, has revealed that the number of property transactions estimated to have been subject to collapse across the UK market has started to climb after 2 quarters in which numbers were reducing. House Buyer Bureau analyses the number of transaction fall throughs across the UK property market, what this means in terms of the average cost of a fall through and what the total cost to the property market is as a result. The latest index shows that the average cost of a fall through during the second quarter of 2023 was:- £3,394, up from:- £3,355 in Q1. At the same time, the estimated number of transactions that fell through in Q2 hit 69,940, a 10.2% increase on the previous quarter. As such, the total cost to buyers and sellers of fall throughs in Q2 was an estimated:- £237.4 million. This marks a quarterly increase of 11.5% compared to the Q1 total of:- £212.9 million. While the quarterly picture is disappointing, it's important to note that current fall through rates are still lower than they were at the same time back in 2022. The number of failed transactions is currently -10.4% lower than a year ago, while the total cost of fall throughs is -5.9% lower.

Managing Director of House Buyer Bureau, Chris Hodgkinson, commented:- "It was more or less inevitable that fall throughs were due to climb this year and this increase has come at a considerable cost to the nation's buyers and sellers at a time when finances are already stretched to breaking point. The market may have cooled in terms of transactional volumes, which has led to a reduction in fall throughs on an annual basis when compared to the heights of the pandemic boom. However, current market conditions are uncertain, to say the least, and many buyers have struggled with the increasing cost of borrowing which has forced them to reassess their position within the market. This has been a driving force behind the recent uptick in sales collapsing during the second quarter of the year and the best way to bypass this property disappointment is to secure a cash buyer as the dangers of a fall through are dramatically reduced. This is easier said than done though, as our recent research found they have accounted for just 31% of sales across Britain in the last year. The good news is, that with the Bank of England finally choosing to freeze rates last week, we should see a greater degree of stability return to the market during the closing stages of this year."

Also, latest data release by estate agent comparison site, GetAgent.co.uk, who monitors the percentage of asking price achieved for sales across each postcode of England and Wales, based on the original price a property was 1st listed for sale at, versus the price they achieved upon completion, has also revealed a fall. They found that over the last 6 months, the average home seller across England and Wales has achieved 97.3% of asking price, a -2.4% drop versus the previous 6 months, with every Region seeing a decline in the percentage of asking price achieved.

The latest research by GetAgent shows that over the last 6 months:- January to June 2023; home sellers across England and Wales have achieved 97.3% of their original asking price, a drop of -2.4% when compared to the previous 6 months:- July to December 2022. Every area of England and Wales has seen a decline in this respect, with the greatest reduction seen in Wales where the percentage of asking price achieved has fallen by an average of 3% in the last 6 months. The South West has also seen 1 of the largest reductions at -2.9%, followed by Yorkshire and the Humber (-2.6%), the North West (-2.5%) and the South East (-2.5%).

In terms of the smallest hit to asking price expectations, it's the capital that has seen the most marginal reduction. London's sellers have achieved 96.4% of their original asking price over the last 6 months, a drop of just 1.6% versus the 6 months prior. However, London is also the Region with the second lowest proportion of asking price achieved at 96.4%, with just Wales seeing sellers secure a lower percentage at 96% on average.

The North East tops the table in this respect, with sellers securing an average of 98.1% of their original asking price over the last 6 months, albeit this is still -2.4% less than they achieved over the previous 6 months.

Co-founder and CEO of GetAgent.co.uk, Colby Short, commented:- "It's quite remarkable that house prices have stood so firm considering such a prolonged period of economic angst, however, a notable reduction in homebuyer activity in recent months has finally started to take its toll. This is now showing in the form of a reduction in the asking price percentage being achieved by the nation's sellers, as they are no longer benefitting from the homebuyer feeding frenzy that drove house prices to record highs during the pandemic market boom. At the same time, those who are looking to buy in the current market have had their purchasing power restricted by the increased cost of borrowing and this has also driven a reduction in asking prices."

Adding to home market problems appears to be mortgages. eXp UK, the platform commissioned a survey of 980 homebuyers currently in the process of buying a home to find out how current mortgage market turmoil and the fast approaching Christmas break are impacting their impetus and ability to search for a new home. The results show that recent rises to mortgage rates have posed problematic for some, with 22% of those surveyed struggling to secure a mortgage to begin with, while 25% stated they had to reassess their mortgage offer during the homebuying process. A further 32% also stated that they struggled to find a home that was suitable based on their mortgage borrowing eligibility, however, it seems as though purchasing power hasn't been the number 1 issue faced in the current market. For nearly 50% of buyers, housing stock is presenting a significant problem, with 48% saying low availability is creating difficulty. This struggle means that 23% have been searching for their ideal home for up to 6 months, a further 20% have been scouring the market for 6 months to a year, while 19% have been unsuccessfully house hunting for over a year. With Christmas on the way, many buyers could be forgiven for packing in their plans to move until after the festive break. However, spirits remain high, with 82% stating they will keep trying to buy a home with maximum effort, 10% will keep looking but be less active in the runup to Christmas, and only 8% say they intend to postpone their search until Christmas is out of the way.

Head of eXp UK, Adam Day, commented:-"There's no doubt that higher mortgage rates have led to a greater degree of buyer hesitation in recent months and a good proportion have struggled b0 when securing a mortgage and finding a suitable property within their purchasing eligibility. But despite the current property market doom and gloom the vast majority remain undeterred in their quest to purchase before Christmas and the biggest obstacle has actually been a lack of stock to fulfil this quest. For the nation's sellers, this means now is as good a time as any to push forward with your sale. While you may not see your sale complete before Christmas, there remains a high level of motivated buyers buoyed by the recent freeze in interest rates."

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Government funding to train 500 new youth workers

YOUNG people will get better support and services as the Government supports the training of youth workers with:- £800,000 of new funding, the Culture Secretary has announced.

More than 500 youth workers and volunteers, who would 0erwise be unable to undertake training, will have their course fees fully paid for by the Government.

The funding will allow adults to access Levels:- 2, 3 or 4 youth worker qualifications, meaning more vulnerable children and teenagers will have someone trained to talk to outside of School, providing a guiding hand to keep them on the right path and unlock their potential.

Funding for youth qualifications in 2020 enabled 1 youth worker in Leicester to complete the Level 3 Diploma, allowing him to continue delivering music sessions and providing mentoring as a qualified youth worker rather than a volunteer.

In Norwich, an0er youth worker who delivers creative writing workshops for young people struggling to engage in education, was unable to access qualifications due to their cost. Thanks to a Government bursary, she was able to undertake the Level 2 Youth Work Certificate, enhancing her practice.

The Government is also announcing more funding for youth services delivered at a Regional level to help youth groups, local authorities and businesses work together more effectively and give young people the best start in life.

The move builds on Culture Secretary Lucy Frazer's aim to give young people:- 'someone to talk to, something to do and somewhere to go.' outlined in a recent keynote speech at the Onward Think Tank.

Culture Secretary Lucy Frazer said:- "I want every young person to have the best start in life and part of that is having a trusted adult and mentor who they can turn to for advice and guidance. For many this will be their parents or family member but for 0ers it will be the Youth worker they meet at their local club. Youth workers provide an invaluable role for tens of thousands of young people when the School day ends, which is why we are funding 500 more youth workers and volunteers to get qualified. This funding builds on our investment in the youth sector, with more than:- £300 million to build or refurbish up to 300 youth centres across the country via the Youth Investment Fund."

The plans announced today include over:- £300,000 to support and improve the delivery of youth services at a Regional level. Existing Regional youth work units will receive:- £40,000 over the next 2 years to facilitate greater coordination between youth services across 8 Regions, making sure the sector is well-informed, skilled and able to meet young people's needs. Regional units also unlock additional funding opportunities to provide more young people with somewhere to go, something to do and someone to talk to.

The funding comes in addition to:- £250,000 being allocated to encourage local partnerships as part of the Local Partnerships Fund, which will be used to improve services on a more local level. The fund is designed to encourage partnerships between:- youth services and Councils, Schools, local sporting and smaller community based organisations so they can provide a more holistic experience for young people.

Partnering with The Young People's Foundation, the funding will be allocated to 10 areas to support partnerships between local organisations. This will help to attract additional funding, such as through match funding by local authorities, raising the standards of local youth services.

Martin Hartley Smith, CEO Young BWD Foundation said:- "DCMS funding via Local Partnerships Fund has been the cornerstone in establishing the Young BWD Foundation in Blackburn with Darwen, enabling us to develop a borough wide strategic plan in close partnership with the local authority. Our collaboration has not only positioned the BWD Foundation and its members as a key strategic partner but has also facilitated the securing of additional funding for a pivotal youth justice project."

Building on the latest financial support for the sector, the Government has also updated the statutory duty guidance which outlines how local authorities should secure services for young people in their area.

Developed in collaboration with:- the youth sector, local authorities and young people, the updated guidance includes more detailed information on how to work with 0er local organisations to best meet the needs of young people.

The updated guidance includes:-

• Clarifications on what local authorities must do under the duty;.
   

• Suggested activities and examples of best practice.
   

• Ways local authorities can work with the voluntary, community and social enterprise sector, youth workers, School and colleges, businesses and employers and 0er agencies and bodies.
   

• Guidance on taking views of young people in their area into account on current and future provision.

Michael Bracey, Chief Rxecutive of Milton Keynes City Council said:- "Youth work can make a hugely positive contribution to helping younger residents thrive and, in turn, the wider community. The guidance is a helpful reminder of the opportunity it presents for Council's as they work to build successful places"

This announcement supports the Government's:- 'National Youth Guarantee' that every young person aged:- 11 to 18, in England, will have access to regular clubs and activities, adventures away from home, and volunteering opportunities by 2025. It is backed by an investment of more than:- £500 million. This includes the Government's Youth Investment Fund of more than:- £300 million, of which:- £160 million has been delivered. This will support up to 300 youth centres across the country to be rebuilt or redeveloped, and help 45,000 more young people access regular, positive activities every year.

This follows the announcement earlier this week that 7,500 disadvantaged young people are to be given access to adventures away from home as part of Culture Secretary Lucy Frazer's vision that all young people have something productive to do.

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