Some 3.7 million Brits say they are likely to buy a new home this year and a third of home owners expect house prices to rise, the research from Santander Mortgages found.
It also reveals that raising a deposit is the biggest barrier for those who feel they can’t purchase a property but more than half, 53% of potential buyers feel more positive about their prospects this year.
Younger people are the most likely to buy, with 12% of those aged 18 to 34 saying they are likely to purchase a new home. This is compared to 7% of 35 to 54 year olds and 5% of those aged 55 or over.
Overall 53% of those planning to buy a home are more positive about their prospects of being able to do so than a year ago, compared to only 15% who are more negative.
By region, Londoners are the most confident about their chances of purchasing a home this year, with 13% believing it is likely they will do so. At the other end of the scale only 4% of those in the East of England think they are likely to buy a new property in 2012.
Of those who are likely to buy a new home this year, roughly a quarter, 24%, will be first time buyers, while just over a third, 37%, intend to buy a new house and sell their current one. A further 15% plan to buy to let and 11% will be buying an additional property to one or more they already own.
Of those who feel they are unlikely to buy a new home this year, the most significant obstacle is not having enough money for a deposit with22% giving this reason. This is a particular problem for those aged 18 to 34, 42% of whom cite this as a reason for not purchasing this year.
One in seven people, 14%, say they can’t afford to buy in the area they want to live in and 9% are simply unable to get a mortgage. Some 5% of aspiring home buyers say they can’t find a property they like within their price range and 3% are waiting for prices to fall further. An additional 4% say unemployment is the main reason for not buying in 2012, and 2% say it’s because they are worried about losing their job.
Others have made a conscious decision not to buy, with 8% preferring to rent and 2% happy to remain living with their parents or other relatives for free.
Home owners are relatively optimistic about house price rises this year, with 29% of them anticipating an increase in the value of their property over the next 12 months, compared to just 17% predicting a fall in value. Almost one in two, 48% of home owners thinks their home’s value will remain static.
Those in London are the most confident that the value of their home will increase, with 40% believing it will do so compared to only 13% who believe it will fall. In contrast, only 21% of home owners in the North West expect the value of their home to appreciate, compared to 24% who believe it will lose value.
‘Given the tough economic climate people are becoming more upbeat about their prospects of purchasing a new home this year. It’s been a tough few years for the property market overall, but prices have made a steady recovery so there’s every reason to feel cautiously optimistic,’ said Phil Cliff, director of Santander Mortgages.
‘There are however, still a number of obstacles out there facing potential buyers, including securing the required funds, which is why the need to look around for the best deals and get some sound advice in terms of properties and mortgages is now greater than ever,’ he explained.
‘At Santander we continue to support the market with our comprehensive range of competitively priced mortgages, available up to 90% LTV, which now also includes a range of buy to let deals available through intermediaries. In addition, all our new mortgages have a Homebuyer Solutions package of free valuation and £250 cashback available, which helps customers with the up front costs of moving,’ he added.
