Significant Rise in Renters Planning to Buy Their Own Homes

The proportion of British adults who say they want to move from renting to buying their next home has doubled during the course of 2018 (from 24% to 58%), according to new data from AA Financial Services.

The findings come at a time when the Government is waking up to the pressing need to help more people get on the property ladder and to increase housing supply. October’s Budget confirmed this, when the Chancellor announced first time buyers’ relief for those buying shared equity homes – plus committing a £500m injection for the Housing Infrastructure Fund enabling a further 650,000 homes to be built.

The AA’s latest homebuyer research indicates that whilst the proportion of Brits planning to move house has remained largely unchanged (at around 12%) over 12 months, the percentage of movers that want to switch from renting to buying their next home has rocketed.

Further, the amount of money people plan to spend on their next home has gone up – hitting a 12 month high of £332,000 this month, a 9% rise over sixth months and and the first significant quarter-on-quarter rise since January 2018.

Average planned spend on a new home: Results by each season of 2018

The AA Financial Services research also suggests that this rise has been driven by movers in London and the South East. Planned house spend in London has risen from £410,840 to £544,957 since the start of 2018, with the figure rising in the south East from £396,571 to £406,478. This starkly contrasts with figures for property in the North East, which sees planned spend fall from £319,490 to £263,264 over 12 months. Overall, planned spend figures on a new home suggest a widening of a north-south property divide.

Average planned spend on a new home: Regional findings

So where do people want to live in 2019?

London and the south east emerge as two of the most popular places to move to for next year – although they are also the regions where the fewest people want to say. For example, only 48% of London movers want to stay within the Capital - and only 61% of movers in the south east plan a local move.

The south west emerges as the most popular place to lay down roots. It is one of the top regions people want to move to – and once there, people don’t want to leave. Overall, 84% of people moving house in the South West are doing so within the region - the highest in the UK.

The north east and east anglia were the regions fewest people said they wanted to move to. The popularity of the East coast has halved over 12 months (from 10% to 5%).

Regions people planning a house move want to move to: Comparison of findings for the start and end of 2018

David Searle, the AA’s Director of financial services commented: “The economic uncertainty surrounding Brexit has not seriously dampened people’s plans to move home. The simple reason is that, for most people, decisions on when to move are dictated by job change, being closer to family or the needs of children.

“Unlike many studies that look back at historic data on property transactions, our study looks forward and focuses on the demand for property. Movers are preparing to spend more on buying a home – and it doesn’t end there.

“With our research suggesting home improvement projects are also on the up, it looks like homeowners are set to borrow £12 billion to do up their homes up in the countdown to Christmas. Whether people are buying homes in the months ahead, looking for loans to improve them, a savings account to build up that rainy day fund or insurance to protect their belongings, AA Financial Services is there to help homeowners when it matters - and we encourage people to challenge us to help them make their money go further.”

Challenge the AA to help you reduce the cost of your mortgage at https://www.theaa.com/mortgages 

Source : Insight DIY Team and AA Financial Services

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