Financial woes of young ‘deter selling’

The debt and other financial problems experienced by young people are a contributory factor to a reluctance of many to sell their homes, according to a new survey.

A study by HSBC found only 12 per cent of homeowners are seeking to move this year and while the leading reason for this is being satisfied with their existing home (cited by 47 per cent), this view is far more prevalent among older people – with 61 per cent of those aged 55 or over happy with where they live, but only 28 per cent of those aged 34 and under being able to say the same.

For these younger people, reasons given for not planning to buy or sell a home include not having a large enough deposit (an issue for 29 per cent), fear of not being able to get a mortgage (15 per cent) and concerns about employment prospects (14 per cent).

The situation is varied regionally, with 18 per cent of London residents hoping to move this year.

HSBC head of mortgages Peter Dockar said: "Our research suggests that the current economic climate is of particular concern to younger people who either want to get on the housing ladder or move on to a larger property."

Another financial concern people thinking of moving may have is the increasing cost of the actual removal process itself.

Research by Lloyds TSB has shown such costs – including mortgage fees, stamp duty and estate agency fees – are now the equivalent on average to 27 per cent of annual income, compared with 22 per cent in 2001.

The bank pointed out this means the cost of moving has actually soared faster than the price of properties themselves.

By James Francis