House-buyers forced to make compromises as prices spiral, KBC survey finds
Process of buying a house is one ‘to be endured rather than enjoyed’
Of the 2,000 people polled, 60 per cent said it was harder to find a suitable home than it was this time last year with 58 per cent accepting they would have to compromise about the type of home they bought. Photograph: Alan Betson
Most people who are currently in the market for a home say they have been forced to make major compromises about the type, size and location of the house they can afford as prices continue to spiral, according to a survey published on Monday.
The bi-annual research from KBC bank suggests that the house-buying process is one “to be endured rather than enjoyed” with many would-be buyers feeling bleak about the prospects of finding the right home for their needs.
Of the 2,000 people polled, 60 per cent said it was harder to find a suitable home than it was this time last year with 58 per cent accepting they would have to compromise about the type of home they bought and over 60 per cent suggesting they would have to compromise on size and location.
The survey also suggests that most of those in the market are driven by changes in personal rather than economic circumstances with 53 per cent of those surveyed looking to buy because they currently live in accommodation which no longer meets their needs.
Needed to buy
A further 26 per cent said they had reached a stage in life where they need to buy with 15 per cent citing altered circumstances such as changes in family size and 12 per cent highlighting other personal or work-related reasons.
It also found that 17 per cent cited expected increases in property prices as the key driver of their plans to buy with 16 per cent saying that cheaper cost of buying was cheaper than the cost of renting.
When asked about the prices in the years ahead, 70 per cent said they thought property prices would be higher in three years’ time than they are today, although a significant 30 per cent said falls were likely.
The survey also suggested that 85,000 home-buyers are in a position to buy immediately, which points to an effective backlog of unsatisfied demand equivalent to about 1½ years worth of transactions.
‘Put down roots’
First-time buyers remains the most important market segment, with 47 per cent falling into the category, although few appear to be driven by a desire to “get a foot on the property ladder” and there is a growing emphasis on finding somewhere to “put down roots”.
Only one in seven people surveyed were considering another move within the next five years and 41 per cent of buyers expect to live in the property they purchase for more than 20 years.
“The results show that demand for residential housing remains strong and highlights the difficulty facing prospective home-buyers,” said KBC’s chief economist Austin Hughes.
“With a housing supply deficit, and some 85,000 prospective home-buyers in a position to buy immediately, there is an effective backlog of unsatisfied demand equivalent to about a year and a half worth of transactions at present, indicating that for most home-buyers, the process of buying a new home is endured rather than enjoyed.
“The survey results find that reasons for buying a home are primarily personal and reflect ‘micro’ circumstances rather than the ‘macro’ economy – people want to buy their first home, to move to somewhere more suitable because their family has grown or, to a notably lesser extent, to build up a nest egg through investment in property,” he added.