UK house prices:over-65s in big homes ‘blocking housing ladder for young buyers’ as market continues to stagnate
Experts at the Nationwide building society said more than half of homeowners are now living in “under- occupied” properties
The growing number of older home owners staying put in properties that are “too big” for them is preventing younger buyers from moving up the property ladder, a leading mortgage lender warned today.
Experts at Nationwide building society said more than half of home owners are now living in “under occupied” properties with at least two spare bedrooms, a marked increase over the past two decades.
Among the over 65s more than two thirds of homes have at least two spare bedrooms.
The shortage of sales of larger family homes by “downsizers” could be a major factor preventing the formation of housing “chains” that allow younger buyers to move out of small starter flats.
Annual house price slowdown
The analysis came as its latest figures showed that the property market continues to stagnate with prices rising just 0.3 per cent in the year to July and levels of property sales still at historically low levels.
It is the eighth month in a row that annual house price growth has been at less than one per cent, according to the Nationwide’s figures.
Levels of home moving activity are still only at half those seen before the financial crash more than a decade ago.
Nationwide’s chief economist Robert Gardner said the lack of properties coming on to the market “may be deterring some potential home movers from trying to sell their own properties - a trend which becomes self reinforcing.
“A possible consequence of the low rate of churn is that the housing stock is not being utilised as effectively as it could be.”
Property commentators also said that the continuing uncertainty over Brexit is also holding back any chance of recovery in the market.
Jonathan Samuels, chief executive of property lender, Octane Capital, said: “The rest of the summer and Autumn will be equally subdued as we approach Halloween and a potential no-deal Brexit.
“Competitive mortgage rates, a robust jobs market and low supply are preventing prices from falling but the market is stuck in a protracted limbo.
“Political uncertainty is clearly one reason why people aren’t moving but the paucity of homes for sale is certainly the other major driver. Checking the property portals is like watching paint dry. New properties are few and far between.”
Jonathan Hopper, managing director of buying agents Garrington Property Finders, said: “In the weakest markets, buyers are having a field day and we’re seeing homes change hands for as much as 30 per cent below original guide price.
“In London and south east England – the areas where prices have corrected most sharply – buyers are dictating terms in negotiations and are frequently able to secure additional discounts on properties that are already reduced.”