UK homebuyers’ wishlists may be at odds with what the new government offers, finds a new survey from Bloomberg Intelligence, with widespread demands for a cut in stamp duty unlikely to be met any time soon.
Higher rates are less of a problem, but builders still need incentives to support sales and buyers of new homes are more likely to say they got a good deal.
Iwona Hovenko, Senior Real Estate Analyst at Bloomberg Intelligence, said:
“Almost half of respondents in our survey seek a cut in stamp duty from the government, but we don’t see this as likely in the near term. The desire was strongest among movers and buyers in the southern England, due to disproportionately high taxes on pricier homes. A third of those surveyed want better availability of long-term mortgage-rate fixes, but only 8% were planning to take out a 10-year fixed-rate loan now. This may be due to the current high level of rates and a lack of desire to lock them in for a long time.”
Buyers of new homes are more likely to say they got a good deal or a discount from the seller (18% vs. 12%), with the search for the right property also taking less time than expected. This suggests incentives are still needed to help homebuilders like Barratt, Bellway, Persimmon and Taylor Wimpey spur sales.
Still, better quality remains the most-cited reason for choosing a new home (39%), followed by lower upkeep and running costs. New-home buyers were also more likely to have accelerated their buying plans and paid higher deposits, but were least keen to live in a village or the remote countryside.
Outside London, brand new homes were favoured by women and first time buyers, while in the capital it was home-movers and men. This was similar to BI’s prior surveys, as was the share of buyers of newly-built homes (17-18%).
Iwona Hovenko, added:
“Buyers getting used to high rates and proceeding with purchases as planned may support housing activity and sales of homebuilders, who’re dependent on wider housing-market sentiment, given new builds account for only about 15% of annual transactions. That’s as a growing proportion of our survey respondents said in June that their buying plans were unchanged (37% in June vs. 29% in February), more than offsetting the decrease in the share of those who brought their plans forward. Notably, though, the fear of further price rises was by far the most-often cited reason for respondents who brought their plans forward.”
