Research from Savills polling 1,200 people found that 13% were more determined to press on with their homebuying or selling plans in light of the election, while for 8%, this had made them unsure.
The study showed that downsizers and those wanting to relocate were the least bothered about the general election impacting their plans, while investors and second homebuyers were more tentative.
Stronger commitment to move
More people are sticking to plans to move within the next six months, with a net balance of +32%, which Savills said was the highest level in more than two years.
First-time buyers and upsizers were the most committed, the survey showed, after subdued activity from these groups over the last year.
Lucian Cook, head of residential research at Savills, said: “With mortgage markets steadily improving, the outlook for the housing market has certainly improved and has entered the first stages of recovery. For the first time since the mini Budget, the survey signalled stronger confidence among typically more leveraged buyers, pointing to a market that will be less heavily dominated by cash- and equity-rich buyers.
“Despite a general election nearing, the short odds on a change in government mean that political change is already largely priced into the market, and for the most part, buyers will remain undeterred about pressing ahead with moving decisions.”
He added: “However, there will be more caution at the top end of the market, which is typically much more discretionary. Buyers here are more likely to play a waiting game, and price sensitivity may remain in the run-up to the election.”
Larger budgets for homebuyers
Savills’ research showed buyers were increasing their moving budgets, with 15% saying they had done so, compared to 8% when the survey was carried out last July.
Savills said this aligned with a change in financing as more people chose fixed rate mortgages after a period of uncertainty around rates.
According to the poll, 44% plan to choose a two-year fixed rate, compared to 31% who said the same in January. Just 11% will be going for a variable rate mortgage, a lower share than the 22% who said the same at the start of the year.
Cook added: “As inflation has fallen, the argument as to whether borrowers take a two- or five-year fixed rate mortgage has moved in favour of short-term deals in anticipation that rates will fall further.
“This also gives people who can get a hold of mortgage finance more confidence to stretch budgets, in the hope that payments will reduce after the initial fixed period.”
Moving on from lockdown home trends
The trends around what homebuyers look for in a property seemed to have moved on since the lockdown, the survey revealed.
Some 65% of buyers said the size of a property was most important. This was followed by 54% who cited the number of rooms, which was higher than the 52% who said the same last year, and 45% in 2022.
Garden and outdoor space, as well as a separate space to work from home, had become less important, Savills said.
The poll found just 31% of respondents felt outdoor space was a priority when homebuying, compared to 42% in February 2022. Just 7% of people said a separate working space was a main draw.
“With fewer people working from home, pandemic drivers are beginning to unwind, with square footage and bedroom numbers more important for prime buyers, particularly for upsizers operating with more constrained budgets,” Cook added.
