News

House prices are up but sales are slow

Lloyds bank estimates that 155,000 Britons moved house in the first half of the year, compared to 171,700 in the same period of 2014 [1], marking a fall of 9%.

Despite this decline, the number of people moving home in the first half of this year was still almost a third higher than the same period in 2009, when the housing market was at its lowest.

There is still a strong demand in the market as house prices have been rising by 6% over the past year. The UK average house price is now £261,524 [1] and in Greater London, the average price paid has risen 45% over the last five years.

A shortage of supply has helped to push up prices, largely due to the population rising more quickly than houses are being built and inward migration to areas like London creating pressure points in parts of the country with low building levels.

Andrew Mason, a mortgages director at Lloyds Bank has said; “while the number of home-movers has risen significantly since 2009, it remains well below previous levels and has recovered less strongly than first-time buyer numbers”.

“This is likely to partly reflect the high costs associated with moving home, as well as highlighting the difficulties that homeowners can face in finding somewhere suitable to move to due to the shortage of properties available for sale” [2].

Combining this with high mortgage deposits and rising stamp duty, with a proportion of 83% of home-movers currently required to pay it [1], the demand for housing has slowed.

[1]. Tim Wallace. ‘House prices are up but sales are still sluggish’. http://www.telegraph.co.uk/
[2]. City AM. ‘London house prices up 45pc in five years: Home movers put off as figures soar’. http://www.cityam.com/