Some 5% of UK households plan to buy a property in the next year, according to a survey conducted by Markit and Ipsos MORI for Knight Frank.
A further 20% of households say they plan to purchase a property within the next five years, and 28% indicate they want to buy a house or apartment in more than five years’ time. Around 17% of households say they have no plans to buy at any stage and 30% of households are undecided.
Gráinne Gilmore, head of UK residential research at Knight Frank, said:
“The data suggests that around 1.35 million households are planning to buy a residence in the next year, highlighting the rising demand for housing across the country. If all potential purchasers were to achieve a sale, this would mark an 18%, or 200,000, rise in transactions over the next 12 months, in line with the OBR’s forecasts released at the Budget last month.
“However this demand could overwhelm supply coming onto the market, suggesting that some households may not achieve their goal of buying a property. Three-quarters of home movers plan to put their house on the market, but there is additional demand from those moving out of the rental sector, and first-time buyers, as well as investors. Supply has been very constrained in the market in recent years and this may well continue to be the case. In turn, this lack of supply is putting upward pressure on prices. This expectation of future house price growth among households has been evident in the recent House Price Sentiment Index.”
“It is interesting to note that the suggestion of increased activity in the market chimes with the momentum being seen in the wider economy, not least the improvement in wage growth. The more upbeat economic picture may serve to help offset some of the effects of higher interest rates – the Bank of England is now widely expected to start raising rates next year.”
Of those planning to buy who already own a home, three-quarters will sell their existing property to fund the new purchase. Some 4% of these households plan to purchase an additional property as a second home or holiday home and 5% plan to buy an investment or rental property, the survey shows.
On a regional basis, the survey suggests that demand for property from households in the East of England will be amongst the strongest across the country in the next 12 months, with 7.9% of households indicating their intention to buy a property within the next year, followed by households in the East Midlands (7.7%). In London, 6.9% of households plan to purchase a home within 12 months – a potential 214,281 transactions.
Households in the North East of England and Scotland are the least likely to be moving home before April 2015, with just 2.1% of households in each region saying they plan to buy a property in the next 12 months.
Some 1,500 UK households across all tenures took part in the survey between April 11th and 14th 2014 with data collected by Ipsos MORI.