The number of movers will fall by a third in 2022, but prices continue to rise, Halifax says

The number of movers has fallen by more than a third in the first half of this year, but the total remains above pre-pandemic levels.

According to Halifax, there was a 133 percent increase in movers during the tax break, so the number would likely decline this year.

However, the number of movers is still above pre-pandemic levels and, apart from last year, is the busiest start to the year for movers since 2008.

Home prices for movers continue to rise, up 5% in the last year and 42% in the last five years

The stamp duty holiday lasted from July 2020 to September 2021.

Movers now make up almost half (47 percent) of all homebuyers, with first-time buyers and landlords making up the rest.

The past year has seen an exceptionally high number of moves due to the government’s stamp duty holidays introduced to support the housing market during the Covid pandemic.

Regionally, Greater London saw the largest drop in moves, with an overall drop of 45 per cent compared to the first half of 2021.

According to Halifax, just 13,765 people relocated in Greater London in the first half of this year.

In contrast, Scotland saw a much smaller decline in moves, just 13 per cent, which was the lowest of any region in the UK.

Andrew Asaam, Homes Director at Halifax, said: “The number of movers so far this year is down from last year’s record high: this was not unexpected and the housing market has remained buoyant so far in 2022.

“If you look at the five-year trend, a different story emerges as the number of movers in Greater London remains relatively flat.

“With the cost of an average mover home in London now standing at £733,628, it is perhaps unsurprising that the London market is correcting itself as many are unlikely to be able to move without additional support in and around the to draw capital.”

Chris Sykes, technical director at mortgage broker Private Finance, said the numbers were still worrying despite strong numbers.

“A second step is a big one for many. These days, it seems impossible for some to go from a typical first-time buyer small home to a larger family home with the costs involved,” he added.

“For example someone a couple of years ago might have bought a £350,000 two-bedroom flat as a first purchase and paid a 10 per cent deposit, £2,500 stamp duty using the first-time buyer discount and a couple of thousand pounds from solicitors and others Fees.

“Now they want to buy a £500,000 three-bedroom terraced house to start a family. Stamp duty alone for this move would cost £15,000, sales charges for her current home would be in the thousands and legal fees for a sale and purchase would be in the thousands.

“They may also need a down payment of more than 10 percent for that next purchase, depending on their income. That’s a lot of money to find for many.

‘This could create a real problem in the long term and result in a lack of real estate inventory for first-time buyers.’

While the number of movers has fallen over the year, the average house price for movers rose 5 per cent to £403,163. Over five years, the average price has jumped 42 percent.

In cash terms, that means those buying a home now have an average of £134,108 to take them up the ladder. In 2017, that figure was £98,219.

At the UK level the typical down payment is now 33 per cent for all movers compared to 20 per cent for first time buyers.

Commenting on the figures, L&C’s David Hollingworth said: “The growing demand for a larger down payment underscores the fact that buyers are grappling with higher prices and paying larger sums in down payment.

“Some of that may be possible through a higher sale price for the previous home, but of course higher and higher prices will naturally put affordability under pressure.

The number of movers in Greater London has fallen by 45% year-on-year, the largest drop across the country.

“At the same time, the cost of living will have started to take hold this year and homebuyers will also feel the effects of higher interest rates on the market.

“Movers will likely want to fix their rates to protect themselves from further rate increases, especially as other costs such as energy are also volatile at the moment. You can choose between short-term to very long-term fixes, depending on how much stability you want to build in.

A lock-in period of ten years or more is possible, but borrowers only need to consider any lock-up period and whether this might affect flexibility later on.’

Looking regionally at the UK, Scotland has seen the smallest change in house price growth since 2017 at 30 per cent.

London movers have the largest deposits to pay for their new home, with the average principal being £248,379.

The nature of moving companies has also changed. Detached and semi-detached houses are the most popular type of housing with a share of 29 percent and 28 percent respectively in the moving market.

Over the past decade, single-family homes have grown in popularity, rising by seven percentage points.

The best mortgage rates and how to find them

Mortgage rates have risen significantly as the Bank of England’s base rate has risen rapidly.

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