First-time buyers outstrip homemovers for first time since 1995

There were 170,000 homemovers in the first half of 2018, down by 1,700 (1%) compared with the same period last year and down by 33,000 (16%) from the second half of 2017. This coincides with a 3% rise in first-time buyers to 175,500.

The fall in homemover numbers follows a rise in 2017, which reported the highest level of movers in 10 years.

Over the past five years, the average price paid by homemovers has grown by 35% (£77,457) to £296,936 – a record high.

In East Anglia, the average price a homemover pays has grown by 46% since 2013 to £305,612, the highest rate of growth in the UK. Greater London and the South East follow with 45% growth in average property prices since 2013.

The average deposit put down by a homemover has also increased by 31% in the past five years, from £76,303 in 2013 to £99,592 in 2018.

Of the estimated 23.1 million households in England, 14.4 million (63%) were owner occupiers. This remained unchanged in 2016/17. However, the composition of owner occupation rates has moved towards an increased proportion of outright owners (34%) versus mortgagors (28%), partly explained by large numbers of baby boomers reaching early retirement age.

So, whilst homemovers with mortgages are stabilising, the bigger picture may be that this is in part because homemovers who don’t need a mortgage are on the increase.

Andrew Mason, mortgage products director at Lloyds Bank, said: “Despite continuing low mortgage rates, the homemover market has stabilised with little movement in the first half of this year to leave first-time buyers now driving housing activity. This may be in part due to the Help to Buy scheme enabling first-time buyers to purchase a new property, combined with the low availability of the ‘right type’ of homes for those looking to move up the housing ladder. The costs of moving house and potential further interest rate rises may also be weighing on potential homebuyers’ minds.

“However, it is good to see the number of first-time buyers increasing, helping to keep some movement along the property ladder.”