Research commissioned by My Home Move has found that the number of property transactions is set to rise by over a fifth in five years to reach almost 1.5 million in 2020 if first-time buyers are given greater access to high loan-to-value lending.
The increase in annual property transaction figures from the 1.23 million recorded in 2015 to the projected 1.49 million in 2020 – a rise of 21.1% – is based on an econometric forecast of property transaction volumes. This includes a 6.6% rise in property sales in 2016, compared to 2015.
The independent research has been commissioned by My Home Move as part of a report published today called ‘Bricks and mortar in a digital world: 15 years of the property market’ which coincides with My Home Move’s 15th anniversary.
Forecast for UK housing turnover
| UK housing turnover | Annual increase | Annual % increase | |
| 2014a | 1,223,280 | 155,670 | 14.6% |
| 2015a | 1,227,770 | 4,490 | 0.4% |
| 2016f | 1,308,900 | 81,130 | 6.6% |
| 2017f | 1,362,298 | 53,399 | 4.1% |
| 2018f | 1,412,632 | 50,334 | 3.7% |
| 2019f | 1,466,654 | 54,022 | 3.8% |
| 2020f | 1,486,889 | 20,234 | 1.4% |
| 2015-2020 | 259,119 | 21.1% |
a represents the actual figure; f represents the forecast figure
The forecast model draws on the historic relationship between property transactions and three variables that have had the greatest impact on property turnover: average mortgage rates, unemployment figures and the average first-time buyer percentage deposit.
As property transactions provide one of the most important measures of the overall health of the UK’s housing market, the research highlights a positive future for the market as transactions are set to advance strongly.
Doug Crawford, CEO of My Home Move, said: “Although house prices have improved since the economic crash, property transaction levels, which are a key indicator of market health, are yet to return to their peak of 2007. This report highlights the critical importance of unlocking access to high loan-to-value mortgage products for first-time buyers, if we are to see transaction volumes grow and the health of the market remain.
“The forecast shows that the number of home purchases could see a dramatic improvement if access to home ownership for first-time buyers is nurtured. In particular, we need more lending to those with smaller deposits so that average deposit sizes for first-time buyers fall to 10%. However, reaching this would require a coordinated effort from across the industry sooner rather than later: from house builders to ensure the supply is there; from lenders to provide the high loan-to-value lending that first time buyers depend on; and from those of us who support first-time buyers with their purchase to ensure that buying a home is as easy as it can be.
“It couldn’t be clearer how important first-time buyers are in ensuring a healthy future for the property market as a whole.”