The figure is based on the estimate that 6% of property transactions fall through and don’t return within a year, which has then been applied to last year’s 1.03 million housing transactions and assumes an average stamp duty payment of £7,590 and average estate agency commission of 1.5%.
The report noted that around £392m in potential estate agency commission was lost in England to property transactions falling through, while it was around £515m in potential stamp duty receipts.
Looking at Scotland and Wales, the estimated economic opportunity stands at £7m and £23m for reducing property transaction fall-throughs. The separate calculations assume a lower fall-through rate in Scotland and different land taxes in each country.
Rightmove said almost one in five transactions fall through before later completing successfully, adding that it took around five months for a house purchase to go through the legal completion process.
The figures show there are “inefficiencies” in the home buying and selling system, pointing to estate agency earning fees being delayed, homemovers having to pay fees more than once and uncertainty in the home moving process.
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Rightmove said “digitisation and alignment of the home moving process” was key to enable a reduction in property fall-throughs.
When contributing to the government consultation on reforms to the home moving process, which closed at the end of last year, the firm said comprehensive upfront information would reduce property transaction fall-throughs.
Johan Svanström, Rightmove’s CEO, said: “Our analysis highlights the scale of the economic opportunity if fall-through rates can be reduced. More than one in five (23%) transactions are affected by fall-throughs, costing agents either lost or delayed fees and leading to some homemovers paying thousands in repeat costs.
“We believe that further digitisation can help to bring this number down. Addressing it will require government investment, innovation across the transaction process, and stronger industry collaboration.”
He added: “The home moving journey is still slowed down by many manual and fragmented processes. A seller shouldn’t need to list their home in April to move before Christmas.
“Our mission is to build the UK’s leading digital ecosystem for the entire moving experience, creating more opportunities for our estate agency partners and helping consumers move with greater confidence and speed. We believe a more effective system and increased mobility would add to overall economic growth in the UK.”
