One in five homeowners abandoned moving plans because of the stamp duty hikes, high house prices and stress, a survey by the HomeOwners Alliance has found.
The analysis suggests as many as 800,000 people could have shelved hopes of moving home because of a cumulative burden of overwhelming costs which were exacerbated by the changes to stamp duty.
On 1 April the stamp duty thresholds were reduced meaning fewer first-time buyer are now exempt from the tax and most movers will pay more to buy a home.
But it was not just this additional financial burden which has put off 20% of potential buyers.
The study found, amongst the group of UK homeowners who wanted to move but didn’t, their main reasons were:
○ House prices (35%)
○ Stress of moving (35%)
○ Moving costs (28%)
○ Lack of suitable housing (27%)
○ Stamp duty (24%)
High house prices – which 35% flagged up as an obstacle – was the joint biggest hurdle. The HomeOwners Alliance said prices had consistently outpaced wage growth, making it increasingly difficult for homeowners to afford the next step on the property ladder.
But with 35% being put off by the stress of the moving process, and 28% being deterred by the cost, the survey results highlight the need for reform in this area.
The same applies for the lack of suitable housing. The HomeOwners Alliance said whether that means larger properties for growing families, step-free homes for older people, or affordable options in the right locations – a lack of the right properties is forcing homeowners to stay put.
The additional cost of stamp duty is also a challenge. The HomeOwners Alliance said, for a family wanting to upsize to a home worth £400,000, stamp duty adds £10,000 to the upfront costs. That’s before factoring in all the other moving expenses.
Paula Higgins, CEO of HomeOwners Alliance, said: “Our research reveals a housing market in crisis – not because people don’t want to move, but because they simply can’t afford to.
“With over 800,000 homeowners shelving their moving plans, we’re seeing families trapped in unsuitable homes, unable to upsize for growing children or downsize as they age.
“While house prices are difficult to control, the government does have levers it can pull and we hope to see this reflected in the Spending Review and the long-awaited housing strategy.
“Stamp duty is acting as a handbrake on the housing market. When a family faces a £10,000 stamp duty bill just to move to a £400,000 home – before they’ve even paid for surveys, legal fees, and removal costs – it’s no wonder a quarter of potential movers are staying put.
“We also need the right mix of homes. Older homeowners need step-free properties, growing families need larger homes, and everyone needs options they can actually afford. Government needs to look at the existing housing stock and how to help people move into homes that better suit their needs.
“Finally, although it may not grab headlines, making the home buying and selling process less of a Russian roulette game and more certain and streamlined would give people the confidence to move.”
