Morris: Powerful reforms needed
The government needs to ensure better up-front information and create a centralised property data system to improve the home-buying process, mortgage provider Santander argued yesterday.
Its research indicated that 530,000 transactions failed each year, causing a £950m hit to the wider economy and cost UK consumers £560m directly, 40% higher than previous government estimates.
The average direct cost to a consumer of a failed transaction is £1,240.
The bank said that “someone buying their first home today will experience a process that’s almost identical to that experienced by their grandparents’ generation” – and it needed to change.
Its report, Fixing the Broken Chain, was based on independent economic analysis from WPI Economics and a survey of over 2,000 consumers by JL Partners,
The impact of the problems with the system was not just limited to failed transactions, Santander argued. “Home buying and selling is being deferred or deterred, causing housing misallocation and additional impacts on the economy…
“Modernisation would directly support the housing agenda by increasing market efficiency, supply and therefore improving affordability. Streamlined processes can reduce transaction times, enabling faster turnover of properties and freeing up housing stock.”
The report said that, despite clear government interest, “there is still a significant underappreciation of the scale of this issue”.
While finding the right property and managing the chain were the hardest parts of the process for consumers, 38% found the legal and conveyancing process difficult, with its length the standout problem.
Around a quarter also complained that they did not know what was happening and when, that the documents were too complicated, and that their lawyer was hard to contact.
“This perhaps reflects the pressure on the system as it currently operates, with stakeholders from conveyancers to surveyors already operating at maximum capacity, which has been exacerbated by a reduction in the number of conveyancers and firms.”
Law Society figures indicated a 15% fall in the number of conveyancers between September 2021 and January 2025.
Some of the change required needed to come from the top down, the report continued. “Government policy and regulatory change will be necessary to make the long-lasting adjustments the UK desperately needs.”
It laid out seven “political asks”:
- Expedite digitisation across all stakeholders, giving access to a digital platform “that can connect with other platforms seamlessly to reduce the amount of time taken with administrative tasks and ensure all data is available to those who need access to it”;
- Implement the collation of better up-front information disclosure from all parties;
- Create a government owned, centralised property data system so that all of the information is in one place at the start of any transaction;
- Improve data sharing through a smart data working group;
- Incentivise the use of AI – automating administration tasks “removes the burden from conveyancers and lenders, freeing up time to spend on the elements of transactions that require their expertise and provide the most value of customers. It will also reduce manual errors from rekeying of data”;
- Disincentivise gazumping and gazundering;
- Take a long-term approach to support market activity; ultimately, building more housing stock “is the only long-term solution that does not inflate house prices for the next generation”.
David Morris, head of homes at Santander UK, commented: “Buying a home should be a moment of excitement and hope, but for too many people, it’s an uncertain and exhausting process, that drains their mental, emotional and physical health.
“The homebuying journey is still operating in the confines of a framework that was established a century ago. This antiquated system is an increasingly heavy anchor weighing on the economy and fixing it must be key.
“While the government has put the housing market firmly on its agenda – as this research shows – the scale of the challenge remains largely underappreciated, and that’s why we’re calling for powerful reforms to give buyers and sellers more confidence, ease the financial and emotional strain and create a housing system fit for the needs of today’s consumers and economy.”