Jul 23 2007
Savills research has today released findings from its UK Housing Market Survey, which shows a market full of dissatisfied householders wanting bigger, better homes who are constrained by high prices and a lack of supply. The survey was sent to a random sample of nearly 500 households across the UK and provides an insight into both the key drivers behind the levels of demand for housing and the main barriers facing households looking to move.
By far the biggest driver of demand is the desire to move up the housing ladder, with those looking to do so outnumbering those seeking to trade down by two to one. This means that there is a shortage of property available to meet this demand, which is reflected in the fact that 40% of the respondents in the survey cited a lack of suitable property as a barrier to moving.
Lucian Cook Director Savills research comments, "One of the key reasons behind the supply demand imbalance lies in the fact that downsizing is seen by most as something to consider in the next 10 years but rarely immediately. . The research suggests that the retention of three and four bedroom houses by those who have retired, or are in the latter stages of their working life will, despite the projected growth in the number of single person and retired house holds not necessarily free up family accommodation. With new house building increasingly targeted towards flats additional pressure is put on the existing family housing stock, which in turn drives house price growth."
High house prices has created affordability issues for all but the most affluent buyers with price acting as constraint to moving in all income bands. For example just under 30% of respondents with a household income of between £50,000 and £80,000 deterred from moving because of high house prices.
These financial constraints are compounded by costs of moving, including professional fees and stamp duty, which according to the survey results act as a barrier to one in three.
Cook again, "Because stamp duty is effectively linked to house price it too has outstripped inflation, a situation compounded by the fact that stamp duty thresholds have not kept pace with house price growth.