Lloyds Bank – First-time buyers now outnumber home movers
In its latest ‘homemover review’, Lloyds Bank has reported that, for the first time since 1995, first-time buyers account for more mortgage activity than those changing residence.
The data released by the bank show that in the first six months of this year, 170,000 households moved home as compared to 171,700 in the first half of 2017 – an annual fall of 1 per cent. Home movers now account for 49 per cent of the housing market. In 2011, this number stood at 62 per cent. Meanwhile, first-time house buyers grew 3 per cent annually, jumping from 171,200 to 175,500.
Perhaps hinting at what is fuelling this activity, the report states that “over the past five years the average price paid by homemovers has grown by 35% (£77,457) and deposits reached record highs,”
Lloyds Bank mortgage products director Andrew Mason says: “This [situation] 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.”
haart estate agent chief executive Paul Smith comments: “You cannot doubt the impact that the government’s stamp duty cut last autumn has had on the first-time buyer market – so it is surely a no-brainer for the government to look to how they can replicate this success across other areas of the market.
“The long-term solution is simple – build more family homes. But in the meantime, there is more we can do to get the market moving. Extending the first-time buyer stamp duty cut to downsizers would be a quick way to incentivise people to move and free up family homes. Downsizers have so far been left behind when it comes to policy to help address the state of the UK housing crisis, but baby-boomers could hold the key to fundamental change.”
Source: Mortgage Strategy