A recent post on social media really got us in the Disney mood. But, surprisingly, it wasn’t Elsa’s bleating in Frozen that was brought to mind by someone whinging about conveyancers. Instead, the writer was complaining about “lawyers only exchanging on a Friday”, so it was rather more Mrs Potts from Beauty and the Beast, and her singing about a “tale as old as time”.
That’s because it’s an accusation that has been knocking around for years. Unfortunately, like most things property-related, it’s a bit more complicated than merely a conspiracy theory that lawyers only exchange on Fridays. Rather than relying on the usual anecdotal guesswork, we figured we’d look at the data and see if we could learn anything from that.
The good news is that we did.
What proportion of exchanges take place on a Friday?
Turns out that over the last three years, on average, the proportion of exchanges increases through the days of the week, starting from 14% on Mondays through to a high of 28% of Friday. So that sorts that. Our social media poster was right – lawyers have been developing a secret plan to only exchange on Fridays. Sort of, because although 28% is the highest day of the week, it’s not what you’d call an overwhelming percentage.
And there’s another thing. We compared the same statistics to those 10 years ago and found the figure was over 30%, which means the numbers are actually going down. While the perceived wisdom from some quarters is that lawyers are getting lazier and more incompetent (we’d love to see evidence to back this up, by the way) this means this alleged lazy incompetence is not causing more exchanges on a Friday.
Why ARE there more exchanges on a Friday?
Mrs Potts was right about this old tale but we’ve never come up with a reason that can be backed up by evidence. One of our favourite theories is that because people want to complete on a Friday, and a week between exchange and completion seems reasonable, they will need to exchange the previous Friday.
Which, if you’re sitting at the dinner table on a Saturday night, complaining to your friends about the broken house buying and selling process, seems pretty reasonable. As it’s the country’s national obsession, no-one actually bothers looking at data, but at least it’s one thing we can all agree on.
We went back to our spreadsheets and it turns out that over the last three years, over 42% of cases completed on a Friday. The same as 10 years ago. It won’t be much of a surprise to learn that Monday’s are the second highest day – perhaps caused by delays to Friday completions by lawyers forgetting to order mortgage monies.
So there we have it, lots of completions on a Friday, so people exchange a week earlier – as that ratty squirrel-like creature would say “simples”. Only, there’s a problem because although on average there are 13 days between exchange and completion, which sounds like two weeks-ish, certain days of the week are higher than others, so there is not enough evidence to prove that exchange days are driven by completion dates.
Finally, just because this had been raised as another problem in the past, we checked to see if the time between exchange and completions was getting shorter. Turns out that they are. Ten years ago, the average time between exchange and completion was about 17 days, whereas now it is only 13 days. Finally, just for the record, the figures show that the number of simultaneous exchange and completions, the bane of all our lives, has not changed, accounting for the same 11% of transactions in the last three years as it did 10 years ago.
Any theories anyone?
The only concrete conclusion we can draw is more transactions exchange towards the end of the week. However, the suggestion that lawyers deliberately delay exchanges until Friday cannot be proved, as we all want deals to exchange as quickly as possible, but in reality we’re dealing with humans who typically work towards deadlines.
It’s worth remembering that many lawyers do not get paid if the deal doesn’t go through, and if they do, it is not the same amount as if it was successful. Transactions are delayed by a lack of appropriate resource – time, expertise and accurate data; a tricky cocktail of issues to solve if ever there was one.
It’s safe to say that the allegation that lawyers deliberately delay transactions until Friday feels more Pinnochio than Mrs Potts, but on reflection, maybe Elsa’s philosophy was a more appropriate response after all.
Peter Ambrose is the CEO of The Partnership and Legalito
