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Following a hectic start to the year driven by the Stamp Duty relief deadline, has your law firm seen a noticeable drop in caseload since April? Or are you still trying to work through the backlog it created? Situations like this can often lead to the classic feast-and-famine cycle. Is this true of 2025? Now that the pressure of the 31st March deadline is behind you, we invite you to explore how the property market performed in Q2 and what the numbers suggest for your potential workload in the remainder of the year.
How did the market perform in Q2 2025?
It’ll come as little surprise that exchanges were down in Q2 2025. We saw a drop of 8.7% year-on-year. It’s a marked change from that frenzied rush of exchanges transacted in Q1.
Commentators were quick to suggest the end of the Stamp Duty relief would rattle the property market, but there’s clearly still an appetite for UK residents to move home, as the supply of New Instructions for estate agents increased by 5.6% compared to Q2 2024. In fact, supply is at its highest level in the past seven years.
Today’s New Instructions are tomorrow’s conveyancing caseloads, and with 493K properties coming onto the market in Q2, there’s ample business heading your way in the coming weeks and months once agents get this stock sold. We are currently seeing an average Time to Sell (the number of days it takes from instructing a property to Sold Subject to Contract) of 80 days, so this suggests a strong pipeline of conveyancing work for Autumn.
Demand, which we measure as Sales Agreed, was also up by 5.3% year-on-year, with 351K properties Sold Subject to Contract. This means your law firm likely saw a steady influx of instructions between April to June.
How buyers reacted to the end of Stamp Duty relief
Around 75,000 homebuyers were projected to have missed out on the Stamp Duty deadline, and of these, 25,000 were first-time buyers. This equated to around a staggering £142 million extra stamp duty costs according to Rightmove and The Guardian. Those who failed to secure a completion date in Q1 had to decide whether to continue with their purchase and pay the higher tax or to abandon the move. eXp suggests there were an estimated 300,000 aborted sales as a result of the increased tax. Our analysts saw fall throughs rise by 8.9%, with a massive 81,135 property sales falling down in the quarter.
The Negotiator published a survey by Upstix prior to the deadline, stating that 19% of buyers would potentially pull out of their property purchase, and only 34% said they would proceed as planned. These fall throughs impacted law firms hugely in lost revenues and hours upon hours of wasted time. Each failed transaction costs those involved £3,493, so for Q2, homebuyers and sellers lost an estimated £283 million collectively.
You can clearly see from the table that the number of Fall Throughs is climbing in each quarter. The first half of 2025 saw 159,990 failed transactions. This is compared to 141,484 in the first half of 2024, a rise of 13.1%. This could have been, in large part, due to the end of Stamp Duty relief. For those that offer a ‘no move, no fee’ pricing structure, it may be time to review whether this strategy is still sustainable in the current market climate.
Transaction timelines
Time to Exchange for the last quarter was 125 days. That’s up 2.9% compared to 2024 and 38% higher than pre-pandemic 2019. This slow transaction timeframe could potentially dampen momentum in the market, as the longer transactions take, the greater the chance of movers getting cold feet and reconsidering their move.
The GOTO Group found that the UK has one of the worst fall through rates globally! Of course, it’s not just the transaction timescales that are to blame for the delays. The survey found that there were four root causes:
- No upfront funding
- No upfront property information
- No upfront contractual commitment
- The conveyancing bottleneck
Nearly a third of failed transactions were buyers pulling out following bad survey results, and over a fifth failed to secure a mortgage. The absence of contractual obligation when an offer is accepted is a major issue – something clearly highlighted by the stronger performance of Scotland’s property market under its differing legal system.
The Government’s plans to digitalise the process will hopefully help to reduce fall throughs in the future, but only time will tell!
Letting lows
The rental market remains under significant pressure. With landlords leaving in droves, available stock for renters is 19% lower compared to 2019. This ongoing shortage of supply has pushed prices up by 36% since 2019. The average asking price is now £1,814 per month, an increase of £47 from Q1. Astronomically high rents are making homeownership the more attractive option, provided a deposit can be secured and a mortgage is within reach. As renters explore buying as a solution to soaring rents and lack of available properties, conveyancers may see an uplift in demand.
The online and hybrid agent effect
In Q2, eXp surpassed Purplebricks as the number one Online/Hybrid agency. Purplebricks ‘List for Free’ model is often offset by directing sellers to their preferred conveyancing partners, so a reduction in their activity may open up opportunities for independent law firms.
Online agent overall market share fell to 4.8%. Within this category, however, self-employed agents are exploding. They represent 2.3% of market share. eXp was actually the number one brand for New Instructions in Q2, so expect more business to come your way from the self-employed agent. It is worth considering building a relationship with your local self-employed agent to win more referral business.
Final thoughts
The good news is that the property market continues to march on with confidence. It is not without its problems and there are, of course, economic pressures that negatively impact transactions. However, the key takeaway from Q2 figures is that UK residents are still showing a strong desire to relocate, so your caseload should continue to be healthy well into the rest of 2025.
TwentyConvey provide property market data insights and conveyancing leads for solicitors. Interested in finding out more? Get in touch!
