Last-Time Buyers Continually Increase Their Market Presence

Although Last-time buyers (LTBs) may be overlooked when it comes to market commentary, this crucial section of the property market are thought to influence over a third of all housing transactions. 

According to a recent report by the Intermediary Lenders Association, the final migration of LTBs has doubled in the past ten years at a pace of over 200,000 housing transactions per year. 

As the population ages and the amount of people over the age of 55 increase, it is estimated that more of this key demographic will decide to move. Currently, 2.5% of the 8 million over 55s in England decide to make a final move. 

This section of the property market can certainly be seen as influential; holding £1.8 trillion of the total £2.6 trillion worth of property wealth. Whether this section of society, that is growing at a faster rate of any other age group, decide to downsize or move into residential care, this age demographic currently monopolise the outright buyers’ market accounting for 132,000 of the 138,000 home sales purchased without a mortgage. 

The report has also found that whilst the annual number of LTB sales is only 2.5% of the total transactions, 47%, or 4 million households, of home owners plan to downsize in the future.  

However, despite the financial clout that this section of the housing market commands, they are still restricted to the same constraints as all other potential buyers: reduced housing stock and a lack of suitable options impede more buyers from leaving their forever homes. 

For the vast majority, the report is clear that their desire to move is not motivated by health implications. Instead, this section are looking to enjoy their sunset years with a dream move, either location or property style. Whilst the stock is limited, it may deter more LTBs from making another housing move. 

Kate Davies, executive director of IMLA, said: “Our increased life expectancy and growing number of people aged 55+ means that, far from being a niche sector, the number of LTBs in England has doubled within a decade. It’s clear that there is much appetite among older homeowners to move into a property better geared to their needs in later life – whether that be in terms of preferred location, character or size, but they face a number of headwinds in achieving that. 

“It is curious that house-builders appear to have been slow to recognize what could be a sizeable market for a variety of designs that combine practicality, low maintenance and energy efficiency. Retirement developments aimed at senior citizens have their place, but they’re not appropriate for everyone. 

“From a lending perspective, we have already seen considerable financial innovation around mortgages into retirement, lifetime mortgages and retirement interest-only products. But there is much more that could be done in fostering LTB schemes, whether these are bespoke equity loan deals, shared ownership schemes or entirely new arrangements. 

It may also be time for the Government to address this LTB policy blind spot and begin to work more closely with the lending and house-building sectors to kick-start activity, much as it did for first-time buyers with its Help to Buy initiatives. 

“With demographic-led demand set to increase, it is hard to avoid the conclusion that we need to unblock new supply and develop new models of housing that cater for mainstream LTBs. We see huge opportunities for the housing and mortgage sectors to better serve the interests of older homeowners over the coming years, and in ways that promote their lifestyle and well-being, as well as the wider health of the housing market.” 

Have you noticed an increase in LTB house moves over the past ten years? Are the majority choosing to downsize? Would this improve the housing stock for established families? 

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