Many choose to sell up and rent
As homeowners struggle with the combined pressures of higher living costs, tighter lending criteria and mortgage rate increases, more and more of them are choosing to sell up and move to rented accommodation.
[UKPRwire, Mon Mar 31 2008] As homeowners struggle with the combined pressures of higher living costs, tighter lending criteria and mortgage rate increases, more and more of them are choosing to sell up and move to rented accommodation.
House price indexes over the past few months have shown a gradual but steady fall in the value of homes across the UK, reflecting the wider economic slowdown and the serious fallout from the credit crunch. Given these conditions and the likelihood that the downward trend will continue, many homeowners see renting as preferable to hanging on to a shaky property ladder.
According to a new survey by the online house-moving service, iammoving.com, 18% of home movers are considering rental because they fear that house prices will continue to fall, while 14% say they need to release equity to help ease money worries.
The survey – conducted on a sample of 1,100 home movers – found that 32% would prefer to remain owners rather than rent, however not at the cost of losing a potential buyer or having to wait to find a suitable property to buy.
The findings also back up data from Halifax last month which showed that owner occupancy fell by 83,000 in 2007 over the previous year, reaching the lowest figure since 1998.
The trend towards rental and away from ownership marks a significant shift in the traditional home-ownership paradigm in the UK. Furthermore, once off the property ladder, many previous owners will find it difficult to get back on, especially those who spend too much of the cash freed up in selling their home.
“As house prices decline, many homeowners find themselves between a rock and a hard place,” said Lawrence Smith of Decision Homebuyers. “What with higher mortgage repayments, higher expenses, and fewer borrowing options on the one hand, and the risk of negative equity on the other, the option of selling up and renting can be the best solution for many.”
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News provided by Decision Homebuyers, a leading UK property company offering a quick and simple solution for selling your home, no matter what the condition.
Decision Homebuyers carries out daily surveys of the national media to provide up-to-date news and commentary on the UK property market.