Homemovers accounted for approximately 49% of the housing market in the first six months of 2018, a considerable drop compared to 2011 when they accounted for 62% of the market, and below first-time buyers for the first time since 1995, according to the latest Lloyds Bank Homeowner Review.
The number of people moving home has dropping in the first half of the year and now account for just under half of the housing market. There were 170,000 homemovers in H1 2018, down by 1,700 compared with the same period last year and down by 33,000 (16%) from the second half of 2017. The review suggested that the inactivity may be fuelled by a shortage of suitable properties for sale, but reflects the broader housing market which is showing little sign of movement.
The fall in homemover numbers follows a rise in 2017, which reported the highest level of movers seen in 10 years. This further coincides with a 3% rise in first-time buyers to 175,000.
Commenting on the findings, Lloyds Bank mortgage product director Andrew Mason said: “Despite continuing low mortgage rates, the homemover market has stabilised with little movement in the first half of this year to leave first-time buyers now driving housing activity. This may be in part due to the Help to Buy scheme enabling first-time buyers to purchase a new property, combined with the low availability of the ‘right type’ of homes for those looking to move up the housing ladder. The costs of moving house and potential further interest rate rises may also be weighing on potential homebuyers’ minds.
“However, it is good to see the number of first-time buyers increasing, helping to keep some movement along the property ladder.”
The report revealed that, over the past five years, the average price paid by homemovers has grown by 35% (£77,457) from £219,479 in 2013, to £296,936 in 2018, a record high. East Anglia saw the highest average price growth, rising by 46% since 2013 to £305,612. Greater London and the South East followed closely behind with a 45% growth in average property prices. Greater London has the most expensive homemover homes, with an average price of £566,200 while the South East has a price of £412,759.
Over the five year period, the average deposit put down by a homemover has risen by almost a third (31%), from £76,303 in 2013 to £99,592 in 2018. The study found that, unsurprisingly, Londoners put down the largest deposit of £189,167 towards the purchase of their next home, almost four times higher than the average homemover deposit of £48,003 in Northern Ireland.
However, while Londoners may put down the highest deposit in monetary terms, homemovers in the South West and East Anglia contribute the largest deposit as a proportion of average house price – 38% (£117,892 and £116,278 respectively in cash), followed by the South East at 35%.
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