The average time it takes for a rental property to go from an offer to an exchange of a contract has increased by more than fourteen days compared to last year to 155 days in April.
Figures from real estate agency Connells show that a year ago the average transaction time was 18 days faster, namely 137 days.
It takes an average of 57 days longer to bring a leased home from offer to exchange than owner-occupied homes, the research also shows.
In April, it took an average of 98 days for a home on freehold land to reach the contract exchange phase. This was 16 days more than last year, when the average was 82 days.
Connells says the delays in the sales process for leasehold properties are driving up overall transaction times due to their impact on other properties in the chain, Connells says.
The long-term trend shows that overall average transaction times are now approximately four weeks longer than in April 2019.
The number of late-stage failures has also increased, the report says.
Connell’s research director Aneisha Beveridge says: “For the first time in history, it now takes an average of more than 100 days for a sale to move from ‘matched offer’ to ‘exchange of contracts’.
“That underlines how much longer the transaction process has become, especially since the pandemic.
“Additional checks, longer chains and stricter legal and compliance requirements all add time, with leasehold purchases being the biggest cause of delays.
“The knock-on effect is that buyers and sellers are left to their own devices for longer once a deal has been closed, and we are increasingly seeing more transactions fail later in the process.
“As sales take longer to work their way through the system, buyers become more exposed to changes in mortgage rates and house prices as conditions change over that period.
“That long-term uncertainty continues to build up.
“This is not just important for the housing market itself – delayed or failed steps can also weigh on consumer confidence, labor mobility and ultimately broader economic growth.”
National Leasehold Campaign co-founder Katie Kendrick says the delays expose a system that is “fundamentally broken”.
She says: “Leaseholders have been warning the government for years that the leasehold system would bring the buying and selling process to a standstill.
“That is exactly what we see happening now.”
Kendrick says it is becoming increasingly difficult to sell rental properties, with transactions stalling, collapsing or taking significantly longer.
She says this is not an isolated problem, but a system flaw built into the leasehold model.
“Leasehold sales go wrong every day because of a system that is outdated, exploitative and completely unfit for purpose.
“Heritage sales that go wrong within the NLC are unfortunately a daily occurrence.
“This isn’t anecdotal – it’s happening on a large scale, and the data now supports what leaseholders have been saying for years.
“This is the bottleneck of leasehold law in action.”
Kendrick added: “The Campaign calls on the government to take urgent action to address the root causes of these bottlenecks and provide a clear and achievable timetable for reform.
“Without decisive action, delays will continue to increase, more transactions will fail and leaseholders will remain stuck in properties they cannot sell.”