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British homeowners priced out of their own properties

Friday 11 May 2018

New research has revealed that a third of British homeowners would not be able to afford their current homes if they were listed for sale on today's housing market.

The poll of 2,690 homeowners, all of whom were 18 or over and owned a property which they had lived in for at least five years, highlighted that a significant proportion of those who own their own home would already be priced out of the market if they were to purchase it again at its current value.

As part of an ongoing study by trade comparison website, MyJobQuote, all respondents were firstly asked to reveal how much they had paid for their current property, with the average answer a modest £180,000. They were then asked to guesstimate how much they believed their property would be worth today, with the median being £230,000; an increase of £50,000.

When asked if they believed they would be able to afford their current home, were it to be listed on the market for them to buy at today’s value, a third (34 per cent) stated that they would not be able to afford it, with the main reason being that ‘the price has increased too much for us to afford it now’ (81 per cent). Just a quarter wouldn’t be able to afford their home due to changing financial circumstances (26 per cent).

Probed further on whether they would choose to purchase their current property again, were it to be listed and price not be a factor, just over half (51 per cent) said that they would. All those that would not were asked why, revealing that a quarter (24 per cent) had ended up spending more on the property than anticipated, via maintenance and renovations etc, one in five (19 per cent) would chose a “more desirable neighbourhood” to buy a home in and 14 per cent confessed that they would not have bought their current home as they “wouldn’t want to get the same kind of mortgage product/length/rate”. Meanwhile, one in 10 said they wouldn’t buy their current home again because they didn’t want to share it with the same partner.

While changed financial circumstances were a consideration for a quarter of participants (26 per cent), the majority (81 per cent) stated that their property’s value has increased so substantially that it would be virtually impossible for them to afford it in today's market.

When all respondents were finally asked if their mortgage repayments had ever caused financial difficulty, one in five homeowners (20 per cent) stated that they had, with more than half of these (55 per cent) stating that they had missed mortgage payments due to money struggles.

Lisa Evans from MyJobQuote said: “These findings show just how tough it can be on the property ladder – getting on at all is a real struggle and many homeowners find it hard to keep afloat, especially as prices seem to keep on climbing so quickly. It’s interesting to see how many people, who have been fortunate enough to own property, would now be priced out of the market on their own homes.”