Home movers’ share of the mortgage market slips to lowest level in over two decades

First-time buyers have overtaken home movers in the mortgage market for the first time since 1995, Lloyds Bank has said in new research out today.

The lender said that in the first half of 2018, mortgage approvals for existing owners purchasing a new property made up 49% of the market.

This is down from 62% this time last year and represents 170,000 mortgage approvals for home movers.

In comparison, there was a 3% annual rise in mortgages for first-time buyers to 175,500, Lloyds Bank says.

Meanwhile, the average price paid by home movers has grown by 35% to a record high of £296,936 in 2018, the lender claims.

Andrew Mason, mortgage products director for Lloyds Bank, said this inactivity may be being fuelled by a shortage of suitable properties for sale.

He said: “Despite continuing low mortgage rates, the home mover market has stabilised with little movement in the first half of this year to leave first-time buyers now driving housing activity.

“This may be in part due to the Help to Buy scheme enabling first-time buyers to purchase a new property, combined with the low availability of the ‘right type’ of homes for those looking to move up the housing ladder.

“The costs of moving house and potential further interest rate rises may also be weighing on potential home buyers’ minds.”

Paul Smith, CEO of Spicerhaart, said: “Today’s data from Lloyds Bank certainty chimes with what we are experiencing on the ground – the number of first-time buyers registering to buy with us is up 22% on the year before, the highest level since Q1 2016, and far surpassing the growth from movers.

“You cannot doubt the impact that the Government’s Stamp Duty cut last autumn has had on the first-time buyer market – so it is surely a no-brainer for the Government to look to how they can replicate this success across other areas of the market.

“Extending the first-time buyer Stamp Duty cut to downsizers would be a quick way to incentivise people to move and free up family homes.

“Downsizers have so far been left behind when it comes to policy to help address the state of the UK housing crisis, but baby-boomers could hold the key to fundamental change.”

Number of home-movers Annual % change Number of first-time buyers Annual % change
2008 H1 179,800 -45% 109,300 -40%
2009 H1 117,900 -34% 72,700 -33%
2010 H1 157,100 33% 95,500 31%
2011 H1 138,300 -12% 86,000 -10%
2012 H1 152,000 10% 100,600 17%
2013 H1 144,800 -5% 115,500 15%
2014 H1 164,500 14% 143,400 24%
2015 H1 156,600 -5% 137,000 -4%
2016 H1 174,100 11% 157,100 15%
2017 H1 171,700 -1% 171,200 9%
2018 H1* 170,000 -1% 175,500 3%

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One Comment

  1. Shaun77

    Has nobody worked out that the Help to Buy scheme essentially syphons first time buyers away from the traditional market and into new build schemes. As such, they fail to ignite an upward chain which then impacts on your home movers market.

    Given the importance of the FTB to quite literally trigger a chain reaction, removing them from the market like this is crazy and no doubt will impact severely on stamp duty receipts and the rest of the moving related tax take.


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