As the housing market has slowed in recent months, transaction times have begun to speed up, bringing a breath of fresh air to both buyers and sellers. In fact, April 2023 marked the shortest average time between agreeing on a sale and exchanging contracts since April 2019, standing at 81 days. This is a significant improvement, with 46% of sellers being able to exchange contracts within three months, compared to only 34% in April 2022 and 33% in April 2021.
Following the Covid-19 pandemic, transaction times spiked due to an influx of sales and delays with conveyancers as they adjusted to the new normal. However, as the housing market returns to 2019 levels, transactions are expected to take a similar or even shorter amount of time, thanks to increased conveyancer capacity.
These faster transaction times are being experienced across the board, regardless of buyer or property profiles. Both chain-free first-time buyers and those in a chain have seen the time it takes to exchange contracts significantly reduced. Similarly, freehold and leasehold homes have experienced recent falls in transaction times. In April 2023, the average number of days it took to exchange on a leasehold property stood at 100 days, down from 132 days in January 2023, while a freehold property took an average of 77 days to exchange.
Cash and mortgaged purchasers have also seen transaction time reductions, with cash purchasers extending their advantage in completing transactions more quickly over the last five years. Typically, cash purchases need less paperwork and are therefore likely to progress quicker.
Despite these improvements, the gap between transaction times for houses and flats has been steadily widening in the long term. This can be attributed to increased scrutiny and information requests from lenders and buyers regarding leasehold homes, particularly surrounding the issue of cladding. Although this gap was only five days in 2016, it has risen to an entire month (31 days) so far this year. This is likely to keep headline transaction times higher than usual, especially as the number of flats changing hands begins to recover.
Ultimately, the recent slowdown in the housing market has led to faster transaction times and a more efficient process for all parties involved. As we continue to adapt to the post-Covid world, we can only hope that these positive trends will persist, making the property buying and selling experience more seamless for everyone.
