The exchange of contracts on the sale or purchase of any property in the UK means that you’re entering into a legally binding contract. But if you don’t complete after you exchange contracts, which means that you’ve failed to complete the purchase of your new home on the agreed completion date, you could end up in a whole heap of trouble and additional costs. Most contracts for purchasing a house in the UK have standard conditions included in the contract. Within the standard contract it usually includes a clause whereby if the buyer fails to complete, after having served a notice to complete, the seller may rescind the contract. Where the the seller invokes this clause, the buyer may forfeit their deposit together with any accrued interest, which will be paid to the seller.
House price predictions after Coronavirus in the UK range from a drop of between 5% to 16%. Based on the average house price in the UK of £231,855, this represents an average fall in house prices of anywhere between £11,593 to £37,097. The level of fall will depend on how quickly the economy recovers from the Coronavirus lockdown. But also, the housing market will continue to be affected where the banks restrict lending by offering lower loan to value (LTV) percentages. In many cases the LTV has dropped from 90% to 75%, which would require an additional deposit of nearly £35,000! Plus if surveyors and valuers are minded to down-value houses for mortgage lenders, this will have a knock-on effect on house prices across the UK.