Down valuations may start hitting conveyancer caseloads -warning  

Conveyancing caseloads remain 34% up on pre-pandemic levels and could become more complex as the market tightens, Search Acumen warns.

The conveyancing software provider’s latest market tracker shows firms registered 76 transactions in the second quarter of 2022, up from 57 in the same period of 2019.

Gains were concentrated at the top end of the market, as the 500 biggest conveyancing firms accounted for 59% of completed transactions between April and June this year.

This was the highest level seen since the second quarter of 2020 in the early months of the Covid-19 pandemic and surpasses any quarter from 2011-2019.

The top 50 firms alone handled more than one in five transactions, which was the highest figure seen outside of lockdown since records began in 2011.

Andy Sommerville, director of Search Acumen, said volumes may drop incrementally as market activity slows, but warned that workloads will be defined by progressively more complex cases.

He said: “Down valuations and expiring mortgage offers may add additional layers of complexity for transacting parties and those stuck in chain, which will all translate into prolonged due diligence. Similarly, all parties will be trying hard to negotiate for every penny in the current economy – sellers because house prices might be dropping, and buyers because of inflation and the increased cost of borrowing.

“Although the cost-of-living crisis is set to slow the market further, we might also see a slew of properties come to market in the autumn as sellers look to take advantage before prices drop too far. At the same time, as interest rates go up, homeowners may be at increasing risk of overextending themselves financially having purchased a larger home since the pandemic, adding more potential sellers to the market.

“As more supply should balance out house prices, this may not translate to fewer transactions, as greater choice allows for more potential buyers to enter the market. It is entirely possible that we see an extended period of strong transactional activity despite economic headwinds.

“Technology is the key for firms to be able to cope with this new normal. The increasing expectations from consumers demanding quicker results can be alleviated through a digital-first approach. At the same time, if the Bank of England is right and we are headed into recession, firms need to think about how technology can future proof their business during a potential market downturn, driving efficiencies, cost savings and providing an edge on competitors in a tougher market.”