Brokers have claimed that transaction times are currently "the longest experienced in over 20 years in the industry”.
Lawson Financial director, Michelle Lawson, pointed out that, due to this increased waiting time, there is a “huge knock-on effect” in terms of lost money and wasted time.
“The longer the process, the more pressure is put on brokers and lenders to change products with the volatile market and the more time people have to back out of transactions with little or no financial loss,” she explained.
“Lenders don’t pay brokers transactions until post-completion, sometimes up to six weeks later, so this has an impact on cash flow and pipeline."
Recent findings from Conveyo found the UK industry average is currently 22 weeks from sale agreed to exchange.
Conveyo’s co-founder, Dr Konrad Rotthege, said: “Conveyancing times are now stretching beyond what was previously considered normal.
“While the industry during market peaks attributed these delays to a lack of capacity, it’s increasingly apparent that this isn’t the sole, or even primary, cause.
“Poor communication and outdated processes within the legal sector are the primary culprits.”
Thomas Legal director, Chris Barry, pointed out that Rightmove said the time between memo and exchange is now 150 days.
“This is the highest it has ever been and the short-term outlook does not make for good reading,” he said.
“The largest contributor is leasehold properties, mainly due to the inception of the Building Safety Act.
“A lot of first-time buyers purchase leasehold properties and therefore BSA-affected properties are involved in a lot of chains up and down the country.
“BSA matters are taking five weeks longer on average when compared to a leasehold purchase pre the introduction of the act.
“People should chooses a solicitor who has vast experience dealing with the type of property they are purchasing, have plenty of capacity to be proactive and are able to keep communication levels high.”
Industry reaction
Additional insight into what the increased waiting times mean for brokers was given by Yellow Brick Mortgages managing director, Stephen Perkins.
Perkins stated that transaction times are “certainly” much longer today than they were before the pandemic, despite many efficient working practices being introduced over that time.
“The usual bottlenecks apply, namely awaiting local searches, delays with the Land Registry and lack of communication between both sides of the transaction in relation to enquiries, some of which are raised needlessly,” he added.
Meanwhile, Albion Financial Advice director, Dariusz Karpowicz, described the delays as a “massive problem” for the industry that is only “getting worse”.
“The biggest issue is the conveyancing process: solicitors don’t actively chase things, and, despite all the technology that is available, transaction times are getting longer,” he explained.
“I don’t think it puts people off buying, as they still want to buy, but it is incredibly frustrating.”
