New research from Santander suggests that collapsed property chains are costing the UK economy at least £1.5 billion annually, a figure significantly higher than government estimates. The report, based on analysis from WPI Economics and a survey of over 2,000 consumers, highlights the financial and emotional toll on homebuyers and sellers.
Key Findings:
- Consumer Costs: Approximately half a million home sales collapse each year, with 23% of consumers having experienced a chain failure. These failures cost consumers around £560 million per year in unrecoverable fees, such as mortgage and solicitors’ costs. The average loss per failed transaction is £1,240.
- Wider Economic Impact: The total cost to the UK economy is estimated to be at least £1.5 billion. This figure includes the direct costs to consumers, along with losses from reduced work output due to stress (£380 million), reduced wellbeing (£400 million), and wasted leisure time (£170 million).
Santander is urging the government to implement reforms to modernize the homebuying process. Their proposals include increasing digitization, providing upfront property information, and introducing measures to discourage gazumping and gazundering. They also suggest creating a centralized, government-owned property data system to simplify the process.
