Fewer people moving home, adding to lack of market activity
The number of people moving home in the UK has fallen in the last few months, which shows that activity levels in the sector have dropped, and there are fewer properties around for first-time buyers to purchase.
It means a rise in the price that newcomers to the sector have to pay, as fewer properties results in more competition among buyers who have to up their offers in order to secure the purchase.
According to a study carried out by Lloyds Bank, home movers now account for around 51 per cent of the market nationwide. This is compared to 64 per cent a decade ago, and also represents a fall of two per cent when held up against the same period last year.
The 171,300 home movers recorded in the first six months of this year represent a fall of around 18,000 when compared to the same time last year, and this contributes to the continued climb in prices paid by first timers in the property market.
Over the last few years, Lloyds Bank said, the price paid by newcomers has risen by £84,869 or about 41 per cent.
It's a trend that could continue if more homeowners choose to sit on what they have and wait for the market to improve rather than moving up the ladder now, which Lloyds predicts might well be the case in the years ahead.
"There are a number of factors which could be influencing this, more people are paying off their mortgages and not moving, with supply at historic low levels there could be a shortage of suitable homes coming on the market and the cost of moving house could be putting people off," said Andrew Mason, Lloyds Bank mortgage products director.