According to Her Majesty’s Revenue and Customers data (HMRC), the number of residential property transactions has halved since its 150,000 a month high in December 2006 to its current low of just over 70,000.
Clearly, the recession has had a significant impact on people moving home. In a bid to help keep the nation moving, a recent survey commissioned by Nationwide Building Society looks into the key reasons for this slow down. Its findings reveal a nation that is cautious about moving home:
- Three quarters of home owners have been in their current property for more than five years
- 60% of non-homeowners have no current plans to buy a property in the foreseeable future
- 38% have no intention of ever moving again.
Even for those homeowners whose property has become too small for them, 29% said they would extend or make do rather than move. Only 25% would look to move to a bigger home.
Tracie Pearce, head of mortgages at Nationwide said: “We can’t change the economy overnight but there are things that lenders can do to help those wanting to move. For example, Nationwide is offering a £500 discount on product fees on its five year fixed rate mortgages and has made 90% LTV mortgages more widely available. We also help first time buyers with our innovative Save to Buy savings and mortgage scheme, offering loans up to 95% LTV, and ensure our mortgages are fully portable, enabling our borrowers to take their deal with them when they move. We’ve also provided impartial, online, interactive buying and selling guides to help steer movers in the right direction.”
So what’s putting people off?
Nationwide asked homeowners what had affected their plans to move, and nearly half (45%) of those surveyed mentioned either the state of the economy or the costs involved in moving home, or both, as representing the main barriers, with instability of house prices following behind at 28%.
Interestingly, when asked about financing their move, most people estimated it would cost them between £5,000 and £10,000 with most people rating Solicitors fees as the biggest cost, rather than Stamp duty or Estate Agents fees.
Tracie continues: “A healthy housing market is key to a healthy economy which is why we are focussing our efforts on getting the nation moving again. It’s no surprise that the economy and costs are the main barriers to people moving. However, if people want to move we’d urge them to look at the options; many fixed rate mortgages are at an all time low and with offers like ours, upfront fees need not be a significant barrier”.
Notes to editors:
Research carried out by YouGov among 1027 UK residents.All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1027 adults. Fieldwork was undertaken between 14-18 June 2012. The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 18+).
Data source - United Kingdom Real Estate Transactions, HMRC, Residential Property Transactions Completions, SA - 1/4/2005 – 1/05/2012
The £500 discount on product fees for 5 year fixed rate mortgages means that the usual £900 product fee will be reduced to £450 for those purchasing a new home, remortgage customers and existing customers moving home, and just £200 for first-time buyers (including the existing £500 product fee discount first-time buyers with Nationwide already enjoy).
This offer is available to all borrowers who reserve a mortgage product from 2 May either in branch, via 0800 30 20 10, online or via an intermediary.
The offer may be withdrawn at any time.
A non-refundable booking fee may apply.
About Nationwide Building Society
Nationwide is the world's largest building society as well as the second largest savings provider and a top-three provider of mortgages in the UK. It is also a major provider of current accounts, credit cards, ISAs and personal loans. Nationwide has around 15 million customers.
Customers can manage their finances in branch, on the telephone, internet and post. The Society has around 16,000 employees. Nationwide's head office is in Swindon with administration centres based in Northampton, Bournemouth and Dunfermline. The Society also has a number of call centres across the UK.