BSA: More buyers look to enter property market, but fear of recession looms large

BSA: More buyers look to enter property market, but fear of recession looms large

BSA: More buyers look to enter property market, but fear of recession looms large

Increasing numbers of people believe that now is a good time to buy a home, with the BSA’s Property Tracker survey finding that 46% of people agree to some extent that now is a good time to purchase.

Despite several reports suggesting further gloom for the housing sector, sellers will take Christmas cheer from the news that the 46% of people represents an increase from the 34% of people who thought September was a good time to buy and the 27% who did in July.

Paul Broadhead, Head of Mortgage Policy at BSA said:-

“With sentiment playing such an important role in the property market, the gradual increase in the numbers of people who believe it is a good time to buy bodes well for 2009. Also it is clear that increasing numbers of people believe that mortgage finance is more affordable than earlier in the year.”

This is supported by the survey finding that concerns about being able to pay the mortgage are receding, with just 37% of people viewing it as a problem, compared with 54% in September and 70% in July.

However, despite this good news for the property market, it is clear that the threat of a recession looms large and may hamper the market’s recovery in 2009. The lack of job security was identified as the major barrier to home purchase by 58% of respondents, compared to 28% in September and just 12% in June.

Paul Broadhead continued:-

“Although buyers are increasingly optimistic about the future of the property market, it is clear that the threat of recession will mean that even these optimistic buyers will bide their time and wait to see what happens to both property prices and to the economy as a whole before they make their play.”

Against this background, it was not surprising that the average change in price predicted by most respondents for the next year was a fall of 8.6% (see note 3).

Property Tracker survey results:-

The questions asked, and the responses, follow along with the results of the September and June surveys.

To what extent do you agree or disagree with the following statement – “Now is a good time to buy a residential property in the UK”?

Dec 08 Sept 08 July 08
Agree strongly 12% 7% 4%
Tend to agree 34% 26% 23%
Neither agree nor disagree 14% 15% 18%
Tend to disagree 22% 26% 33%
Disagree strongly 15% 22% 18%
Don’t Know 3% 3% 3%

Which of the following do you think are most likely to stop someone from buying a residential property at the moment?

Dec 08 Sept 08 July 08
Lack of job security 58% 28% 12%
Access to a large enough 56% 57% 49%
mortgage / mortgage at all
Raising a deposit 40% 42% 47%
Concern about future falls 40% 51% 46%
in property prices
Affordability of monthly 37% 54% 70%
mortgage repayments
Legal, valuation and other 10% 11% 12%
“official” costs
Stamp duty costs 7% 11% 16%
Complexity of the buying process 3% 6% 4%
Finding the right property 3% 4% 4%

Respondents could choose up to three factors, so percentages do not sum up to 100%.

BSA’s Property Price Tracker survey also asked respondents how they expect property prices to change in the next twelve months. The average prediction for the year was an 8.6% fall compared to an 8.4% decrease in September and a 7.1% fall predicted by the survey in June3.

~ Ends ~

Notes to editor

The BSA Property Tracker Survey takes place quarterly and provides an understanding of how the British public view the housing market.

All the figures, unless otherwise stated, are from YouGov plc. Total sample size was 2,133 adults. Fieldwork was undertaken between 5-8 December 2008. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).

The averages quoted are median figures based on additional analysis of YouGov survey data carried out by the BSA. This excludes those that replied “don’t know” and assumes answers are evenly distributed through each range of price changes that could be chosen.

The results of the next Property Tracker and Property Price Tracker surveys will be published on March 18 2009.

The Building Societies Association (BSA) represents all 57 building societies in the United Kingdom. Building societies have total assets of £380 billion and, together with their subsidiaries, hold residential mortgages of £250 billion, more than 20% of the total outstanding in the UK. Societies hold about £235 billion of retail deposits, accounting for more than 20% of all such deposits in the UK. Building societies also account for about 37% of all cash ISA balances. Building societies employ over 51,500 full and part-time staff and operate through more than 2,000 branches.
Neil Johnson
PR & Policy Manager
Building Societies Association
Tel : 020-7520 5903
E-Mail : neil.johnson@bsa.org.uk

The Building Societies Yearbook 2008-09 is now available – http://www.bsa.org.uk/publications/industrypublications/yearbook0809.htm