The number of people moving home in the UK is at its highest level since 2007, up by 2% to an estimated 370,300 in the last year, according to new research.
The increase in home movers could be a result of continued low mortgage rates and high demand for homes, which have made it easier for home movers to take the next step on the housing ladder, says the latest Lloyds Bank Home Mover Review.
The increase in 2017 follows a decline in the number of home movers reported in 2016, which fell for the first in five years and since hitting a market low of 315,000 in 2009, the number of home movers has grown by 18% or 55,300. However, the current number is still 43% below the level of 653,700 seen in 2007.
‘We’ve seen a slight increase in the number of home movers following a weak 2016. This could be down to low mortgage rates, rising house prices and high employment levels. House price increases will have boosted equity levels for many home owners, enabling movement along the housing ladder,’ said Andrew Mason, Lloyds Bank mortgage products director.
‘For the first time, home movers are choosing to pay an average deposit of over £100,000, with Londoners putting down nearly double this. Taking advantage of increased equity levels by putting down a bigger deposit can really make a big difference towards what home movers can afford and can be the difference between a good home and the right home,’ he added.
The review also shows that high house prices in London have adversely impacted the home mover market in the capital, with numbers of home movers falling by 6% to 22,600 in the past year, the only region to have a decline in numbers.
The South East region has the highest number of home movers at 65,400, more than double the next highest region, South West with 27,500. Northern Ireland has the lowest number at 4,400.
Over the past five years, the average price paid by home movers has grown by 44% or £90,879 from £205,852 in 2012, to £296,731 in 2017.
In London, the average price a home mover pays has grown by 59% since 2012 to £568,816, the highest in the UK. The average home mover price in the capital is 40%, or £161,429, higher than the South East at £407,386 which is the second most expensive. Northern Ireland has lowest average price of £164,878.
The average deposit put down by a home mover has also increased by 45% in the past five years from £69,089 in 2012 to £100,387 in 2017. Londoners require the largest deposit of £196,535 towards the purchase of their next home, which is four times the average home mover deposit of £46,032 in Northern Ireland.
However, whilst Londoners pay the highest deposit in monetary terms, home movers in East Anglia pay the largest deposit as a proportion of average house price at 37% or £110,321, followed by both the South East and the South West at 36%.
The increase in the number of home movers is an encouraging sign given the tougher market conditions post-Brexit and this has no doubt been helped by the low borrowing costs, according Russell Quirk, chief executive officer of eMoov.
‘While a boost in equity will have also aided many homemovers to take the next step, perhaps the most important change the market has seen, is the increasing number of first time buyers. This is particularly encouraging when you consider the huge barrier of unaffordability not just where the price of a property is concerned, but also the initial deposit required to secure it,’ he explained.
‘Over the last year or so, market uncertainty has deterred many from committing to a sale in fear of cashing out too early on their existing asset. It’s this increasing level of first time buyer demand that has kept the market ticking over as a result of their aspiration to become homeowners, not their desire to profit from their existing home,’ he pointed out.
‘Despite benefiting from years of heightened price inflation, London continues to feel the brunt of the market slowdown with those already residing in the capital deciding it is better to stay put then to make a move, in what is currently the worst performing region of the UK,’ he added.
