Sales of second-hand homes will continue to be affected by lengthy delays in the Probate Office this year, impacting the supply of properties to the market during the normally busy spring selling season, estate agent Lisney has warned.
Published on Wednesday, the property group’s 2024 market outlook also points to a delays in mortgage drawdowns as one of the main factors likely to impact sales in the first half of the year.
Overall, Lisney said potential purchasers would remain cautious in the opening months of the year, adopting a “wait and see” approach “focused on the macroeconomic situation but also contending with constrained options due to lack of supply”.
If interest rates begin to fall in the second half of the year, as expected by many economists, “this caution may lessen”.
However, housing supply “is unlikely to improve” in the short term with Probate Office delays continuing to cause “uncertainty” for buyers, Lisney said.
Solicitors sounded alarm bells last year about significant delays in the issuing of probate grants, which are causing land and home sales to fall through.
Lisney claimed that some grants of probate are now taking up to 22 weeks to process from the date of lodgement. Consequently, it said “buyers are reluctant to engage with properties when they have no certainty on when a sale could close”.
Lisney managing director David Byrne said: “A catch-22 situation remains where potential vendors cannot sell until they buy and cannot buy until they sell. Even if they do try to go ‘sale agreed’ on a new home, some vendors will not engage until their existing home is sold as they do not want to be involved in drawn-out chain sales.”
[ Staff shortages and solicitor errors contributing to probate grant delaysOpens in new window ]
The report also highlights issues with mortgage drawdown process.
“With fewer lenders in the market since Ulster Bank and KBC exited last year, banks are slow in converting ‘approved in principle’ offers to formal mortgage offers as they forensically assess documentation,” Lisney said.
However, lengthy conversion time from approval-in-principle to drawdown is also likely a symptom of the mismatch between supply and demand in the market at the moment. Mortgage brokers have said that many borrowers are being approved for mortgages without having identified a property for purchase, boosting the mortgage approval statistics throughout 2023.
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