Existing home owners moving home mainstay of activity Thursday, 12th November 2009

As it continues to be difficult for first time buyers to get mortgage finance, the increased levels of activity recorded in the housing market in recent months are shown to be down to existing property owners moving home, rather than first-time buyers coming back to the market.

Increasing optimism about the residential property sector is being reflected in a greater number of valuations for people moving home. This is mainly due to movers not first-timers,who in the main have been precluded through a lack of available mortgage finance.

Transactions were up 26% in October 2009 compared with the previous year, and up 13% in the 3 month period.

Ross Bowen, Managing Director for Connells Survey & Valuation said:

“This upswing in the number of valuations for homeowners is further evidence of the gradually strengthening housing market. Sellers who have been sitting out the recent economic woes have seen double digit house price rises since the spring, are putting their homes on the market and are moving on.
"The low level of activity over the past couple of years has created a lot of pent-up demand and people want to move - and established homeowners typically have more equity and are better placed to buy.We are seeing more positive sentiment in the housing market, but lending conditions are still proving very challenging particularly for first-time buyers. After recent corrections many people see this as a good window of opportunity to get a foot on the property ladder - and stop paying rent. But often they need to find a deposit of £30,000 which is out of reach for nine out of ten of them.Home ownership remains the goal of many people in their twenties and thirties, despite underlying concerns over how unemployment will play out in the economy over the next few years. The sooner we can get more lenders in the 90% LTV space on a consistent basis, without overly punitive criteria, the sooner we will see firmer footings in the housing market.”