The Lloyds Bank Homemover Review for the first half of 2017 found the number of homemovers in the first six months of the year was down by 2% to 171,300 when compared to the same period last year.
Homemovers accounted for only 51% of the housing market compared to the 64% share they held a decade ago. In the last five years, homemovers have seen average prices jump by 41%, forcing them to find an extra £84,869 when moving.
Andrew Mason, Lloyds Bank mortgage products director, said: “There are a number of factors which could be influencing this, more people are paying off their mortgages and not moving, with supply at historic low levels there could be a shortage of suitable homes coming on the market and the cost of moving house could be putting people off.”
He added: “This has meant that homemovers now account for just half of today’s housing market compared to a decade ago when it accounted for two-thirds of the market. This has a knock on affect for first time buyers as there will be fewer properties available for them also.”
Prevents market growth
Richard Sexton, director at e.surv agreed that the trend towards fewer homemovers stepping up the property ladder was gumming up the market for first time buyers.
He said: “Put simply, it prevents market growth. Although the market will not grind to a halt, as low interest rates and the willingness of banks to lend keep demand up, these figures should serve as a warning.”
Sexton said the findings were another shot across the government’s bows and that it had to act.
He added: “The government must address our country’s lack of housing supply sooner rather than later, to allow more first-time buyers to step onto the property ladder. This will give a much needed confidence boost to the housing market, give current homeowners the assurance they need to move and ultimately, will keep the housing market fluid.”
£1,400 per month rise
Over the past five years, the average price paid by homemovers has grown by 41% (£84,869) from £206,122 in 2012, to £290,9913 in June 2017, equivalent to a monthly rise of £1,414.
In London, the average homemover price has grown by 56% since June 2012 to £561,032, the highest in the UK. The average homemover price in the capital is 41% or £163,579 higher than the South East (£397,452) which is the second most expensive. Northern Ireland has lowest average price of £165,404.
The average deposit put down by a homemover has increased by 40% in the past five years, from £68,663 in 2012 to £96,109 in 2017. Londoners put down the largest deposit towards the purchase of their next home; £188,916 – four times higher than the average homemover deposit of £48,080 in Northern Ireland, the lowest.