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One in five sellers stuck where they are, says agent

08 July 2009
Written by rosalind renshaw

Nearly one in five would-be sellers wanting to instruct an agent are unable to go ahead, because they are stuck where they are.

According to haart, 18% of their valuation visits are fruitless because the householders have insufficient equity to move on.

The downturn in prices means owners face negative equity and/or not enough for a deposit on their next home.

“We have found that many couples starting a family are stuck in a one-bed flat because they cannot afford to move out,” said haart chief executive Paul Smith. “The same goes for friends who bought together and now want a place of their own or couples who have split up.

“Even if they do have enough equity to sell, they can’t find a 10 or 15% deposit for their next home, so they are stuck in a house-move trap.”

Smith is now calling for the reinstatement of higher loan to value mortgages.

According to the Bank of England, 1.1 million home owners are in negative equity, the same as at the worst of the 1990s recession.

Comments

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    the housing amrket is like a forest that has comne to an end of a growth spurt. The only way for more growth is to burn some of the forest. This is what will happen with the housing market. Affordability is fully stretched aided by the lowest base rates ever and many homeowners way above a 3x income mortgage and other high amounts of debt. Inflation will start creeping up soon, higher interest rates and more job cuts will lead to a surge in defaults/repossessions and then we wil have the crash the market needs. Then whoever is left standing at the end can look forward to a market with growth in its legs. At the moment it is all about conserving cash and paying down debt if possible, forget about moving up the ladder.

    • 10 July 2009 09:16 AM
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    One of the reasons we are in his recession is because of people having more than they cannot afford. If they cannot afford a more expensive property, they should not be given one because it will only lead to problems down the line.

    • 08 July 2009 14:20 PM
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    So back to the "let's have a HIP holiday" then to get would-be vendors to at least willing to test the market.

    • 08 July 2009 09:40 AM
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    This is only a small part of a wider problem. Much of the current stagnation in the market is due to potential vendors not being able to find something suitable to move to and therefore refraining from coming to the market themselves. If everyone who wants to move(as opposed to 'needs to')put their homes on the market everyone would have a better choice and we'd see sales volumes substantially improve.

    • 08 July 2009 08:38 AM
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