New research from an up-front information platform called Home Sale Pack, reveals that the UK housing market could be set to see a surge in activity, as 82% of current buyers say that now ‘the Spring Budget has come and gone, they plan to ramp up their search for a new home’.
Home Sale Pack has conducted a survey of 1,002 current UK homebuyers on their plans to purchase in the current market to find out if homebuyer activity is about to increase as we head into the summer months.
The survey suggests that a ‘majority of current buyers have been postponing their search until gaining a greater understanding of political intentions towards the housing market as we move towards a general election’.
This is illustrated by the fact that 82% of buyers surveyed say they have been waiting to hear Jeremy Hunt’s Spring Budget statement before making their final decision on whether or not to start the process of buying a new home.
The Chancellor confirmed that under the conservative government, the UK has already seen one million new homes and is set to see 8,000 more as he unveiled plans for investment. The budget meeting saw MPs jeering chambers as Hunt proposed investment in ‘UK families, and working families’ alongside plans for tax cuts and investment in small business.
The party said £188M will be invested into property in Sheffield, Blackpool and Liverpool. The £242M will go towards building up Barking Riverside and Canary Wharf as a tech hub – stating the UK is set to become the ‘next Silicon Valley’.
One reason for their waiting was to see whether or not the government planned to introduce any homebuying incentives in the Budget. 52% say they were hoping to see some form of pro-homebuyer policy announcement, such as 99% mortgages or stamp duty relief.
Despite the lack of incentive from the budget, 78% of buyers surveyed say they now plan to continue with their plans to purchase regardless of the disappointment.
Meanwhile, 14% say the Budget has led them to continue to delay their final decision, and just 8% say the lack of incentives has forced them to cancel their ambitions altogether.
Those who plan to move ahead with their homebuying plans continue to face some significant challenges.
The two most common challenges, which have both been cited by 29% of buyers, are securing an affordable mortgage with mortgage rates as high as they currently are, and finding a buyer for their current home in order to fund an onward purchase.
Other challenges include being able to fund a mortgage on current income levels (18%), saving the required deposit (14%), and finding a buyer who is willing to negotiate on price in order to make the purchase more affordable (10%).UK interest rates have been held at 5.25% since August 2023, and broad expert consensus says that this means rates have peaked and will soon start coming down.
However, this confidence doesn’t seem to be passing through to homebuyers as over half (54%) express concerns that rates will once again rise at some point this year.
If this happens, 49% of buyers say it will force them to reassess their position in the market in terms of affordability.
While another rate increase will certainly be food for thought for many buyers, it appears that the majority intend to push forward regardless as only 35% say they would abandon their buying ambitions altogether in the face of further rises.
Ruth Beeton, Co-Founder of Home Sale Pack, says:
“There is clearly a real determination among hopeful homebuyers. They have been waiting for the market to settle down and hoping for some kind of government-led intervention to make buying that little bit easier, but even though no such incentives have been provided, and even though interest rates are yet to start falling, most buyers are gallantly holding firm and pushing forward with their plans to buy.
“It seems that one definite concern is that rates will once again increase, but it’s unlikely that this is going to happen. We fully expect to start seeing rates come down this year, and this increased affordability will result in a surge of buyer demand on the market.
“Agents and other property professionals need to be ready for an increase in activity, and a big part of that is having systems and processes in place to ensure that each homebuying and selling journey moves as smoothly and efficiently as possible.
By focusing on areas such as the better preparation and provision of upfront information, they will be better positioned to avoid the inevitable delays that come with a surge in market activity, like those we encountered during the market boom brought on by the pandemic stamp duty holiday.”
However, some say that the property market ‘won’t see a boost’ in the coming months.
The survey of 833 UK property professionals, commissioned by GetAgent, found that the vast majority were disappointed in last week’s lacklustre Spring Budget, with 27% describing it as inadequate and a further 54% stating it was underwhelming.
The industry had been expecting a significant announcement on 99% mortgage however, this was scrapped just days before, a decision that 56% of those surveyed agreed with.
In its place, there had been hopes of another stamp duty reduction based initiative and 71% of those surveyed by GetAgent believe this should have been included by the government.
67% also stated they would have liked to see some other form of buyer incentive introduced to help kick start the market, with 64% stating they would have liked to have seen more focus on housing supply. What’s more, 83% think more should have been done to improve the homebuying and selling process.
