Using insight from TwentyCi, Novus Strategy, the time to exchange contracts has increased 3% or four days since last year and 45% or 42 days since 2019.
The firm said this highlighted a “configuration problem” in the technology used across sector that went beyond adopting digital solutions.
Based on figures from HMRC, there were 79,880 property transactions in January, 3% fewer than the 82,350 completed during the same month last year.
The time to exchange extended by the most for the £1m-plus property market, rising 8% from 136 days to 146 since last year. Novus Strategy noted that transactions in this part of the market usually involved complex financing arrangements, additional legal scrutiny and longer chains.
Including the time to sell, which currently stands at 86 days, Novus Strategy said the whole process now took around 221 days or seven-and-a-half months.
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This data comes as work is being done across the sector and by government to improve the transaction process, including efforts from government body the Centre for Finance, Innovation and Technology (CFIT) and industry organisation the Open Property Data Association (OPDA).
Both are advocating a more connected process, with agreed standards for upfront property information, reusable permissions, qualified electronic signatures (QES) and trusted digital identities to streamline the process.
Novus Strategy said these features could not be introduced without horizontal digital integration (HDI), an operating model that lenders can use to alter internal and external processes to allow for the use of these innovations.
The property ecosystem is still too fragmented
Claire Van der Zant, CEO of Novus Strategy, said it was disappointing to see it was taking longer to exchange and this had been trending upwards for some time.
She added: “It only confirms what we, and many others across the industry, have been saying for a long time, which is that the ecosystem remains too fragmented.
“All companies involved in the mortgage and residential sales market have faced increasing workload and regulatory obligations in recent years, but technology has failed to keep pace.”
Van der Zant added: “There is only so much efficiency to be gained from solutions that are not interoperable. There remains a huge amount of friction between these businesses when they need to coordinate and communicate with each other, in order to push a transaction forward. Data captured digitally in one organisation cannot easily be reused in the next, and what you end up with is a fragile digital journey even though individual solutions might be extremely powerful in isolation.”
She said this was why the government was focusing on reforming the home buying and selling process, saying its recommendations could not come sooner.
Van der Zant added: “Progress has been made by brokers, lenders and conveyancers but largely in isolation. Each part of the market has developed its own customer journeys and digital processes, so the challenge now is for the industry to connect those parts together through HDI, solving problems like trust, interoperability and liability simultaneously.”
