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Fall in Home Mover Numbers in 2016

There was a fall in the number of people moving home in Britain during 2016, according to the latest Lloyds Bank Home Mover Review. This is apparently the first time in five years that numbers have decreased.

Shortage of Houses on the Market

The figures show that in 2016, the number of home movers is estimated to have dropped to 354,000, which is a fall of 4% compared to the 367,300 recorded in 2015.

Overall, the number of home movers has grown by 12% since the lowest point of the recent housing downturn in 2009, when the number of people moving home totalled 315,000, the second lowest since records began. However, the 2016 figure is still 50% below the 712,000 home movers recorded a decade ago.

“Despite favourable economic conditions including record low mortgage rates, high employment levels and rising real pay growth, the number of home movers fell in 2016 for the first time in five years,” commented Andrew Mason, Lloyds Bank Mortgages Director. “Whilst higher prices will have lifted equity levels for many current owners, the low availability of the ’right type‘ of homes for those looking to move up the housing ladder may have constrained market activity.”

“The ability of home movers, particularly those in their first homes, to move on is an important component in the housing market, as it increases the supply of properties, providing homes for new first-time buyers,” he added.

House Prices

In 2016, the average house price paid by home movers increased by 7%, from £273,510 in 2015 to a record high of £291,777. Since falling to £199,645 at the depths of the housing downturn in 2009, the average price has grown steadily by 46%, or £92,000.

These house price rises have also contributed to higher average home mover deposits, which reached £96,968 in 2016, an increase of 33% (£23,978) from £72,270 in 2009. Over the past twelve months, the average deposit has grown by £5,640 (6%).

Positive Mortgage Lending Figures

Despite the fall in home mover numbers revealed by Lloyds, the latest figures from the Council of Mortgage Lenders (CML) show that total lending in 2016 reached an estimated £246 billion, which is a 12% increase on 2015’s £220 billion and is the highest annual gross lending figure since 2008.

“The UK housing market, much like the wider UK economy, ended 2016 on a generally positive note,” said CML senior economist Mohammad Jamei.

“Approvals for house purchase have recovered strongly of late, and this should feed through to lending figures in the early months of 2017,” he explained. “The current availability of mortgage credit is benign, and the real issue continues to be a dearth of properties on the market, which adds to the challenges facing would-be buyers.”

“Uncertainty associated with political factors and prospective changes to the tax treatment of landlords will weigh on prospects for the year ahead,” he concluded.

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