More people in UK want to buy a home but ownership levels are falling

The appetite amongst people in the UK to own their home has risen steadily over the past four years but ownership levels have also been falling, new research shows.

Some 73% of non-home owners now say they would like to own their home compared to 69% last year, 68% in 2014 and 65% in 2013, according to the annual survey from the consumers group the HomeOwners Alliance.

But despite more people wanting to own the roof over their heads, home ownership levels have been declining for the past decade after peaking in 2002 at 69.7% and the report says this is because the high demand for homes is pushing house prices to unaffordable levels.

It explains that the mismatch between house prices and wages is worsening, average house prices have risen five times more than wages in the last five years and this is exacerbated by an inadequate supply of new homes. 

It also points out that despite a series of measures announced by the government aimed at supporting first time buyers, such as the Starter Homes Initiative, extension of the Help to Buy loan scheme and introduction of a new Help to Buy ISA there are still difficulties in first time buyers finding affordable homes.

One issues is that in dealing with the housing crisis, much of the focus has been on helping first time buyers, but there is growing recognition that solutions need to go further, it suggests, adding that with availability of homes for sale at a record low, last time buyers in under occupied homes have become a focus for freeing up housing stock for younger families.

‘Despite a blizzard of government initiatives aimed at helping homeowners, the housing crisis is deepening across the country, with ever more non-homeowners wanting their own home, and ever greater concern about the lack of housing,’ said Paula Higgins, chief executive of the HomeOwners Alliance.

‘Many government policies have boosted demand for homes, but what this survey shows is that the real problem is the desperate shortage of houses. Until the government tackles the fundamental issue that we just don’t have enough good quality homes, the housing crisis will continue to deepen and a generation will continue to have their dreams of home ownership crushed,’ she added.

It explains that so-called last time buyers, could help ease the housing crisis in the UK freeing up under occupied properties. There are an estimated 11.4 million home owners age 55 and over and 10% of them have considered a move in the past two years but did not.

Some 23% of home owners aged 55 or over who considered moving say lack of suitable housing was the main reason they did not do so, this equates to more than 500,000 home owners.

Stress and upheaval of moving is also more likely to be a barrier for those moving later in life with 30% saying so compared to 21% of home owners overall. Some 23% didn’t want to move away from friends, neighbours and their community compared to 17% of home owners overall.

The survey also found that last time buyers may be put off from buying new build homes because they don’t meet their needs. Older home owners see new builds as being particularly strong on low running costs but less likely to be spacious or provide living on one level. Being near to amenities and good transport links are also aspects that are seen as less typical of new build homes.

‘The issues highlighted by this survey that face last time buyers are as acute as those issues encountered by first time buyers. If we wish to provide the required quality of housing that addresses these concerns we desperately need an appropriate mix of well-designed homes alongside adequate local infrastructure to help address the current housing shortage,’ said Kim Vernau, chief executive officer of BLP Insurance.

The research also found that in London there are higher levels of concern than the UK overall for house prices, availability and quality of housing, ability to get a mortgage or remortgage, stamp duty rates, gazumping and leasehold issues.

Overall it found that new builds are not popular with more than twice as many people preferring an older home to a new build home at 49% and 19% respectively. When considering new homes quality, people are likely to focus on size of rooms, the feeling of space on the development, layout and the level of finish.

When it comes to new homes quality aspects which are less focused on include the reputation of the house builder, clear explanation of the sales process and the provision of detailed floor plans including square footage while 58% would want a survey as a quality check before buying a new build home.