Semi-detached homes with three bedrooms are Britain's most sought-after properties say estate agents
Tue 22 Apr 2014
Many first-time buyers are opting for three-bedroom properties.
Demand is outstripping supply - pushing up prices even further stamp duty is fuelling the problem by putting owners off moving house
Semi-detached homes with three bedrooms have become the most sought-after property in Britain, selling in less than a week in some areas, a report revealed today. Half of estate agents said they are the property which everybody wants to buy, while just four per cent of agents voted for bungalows and seven per cent for flats.
Robin King, a director of Move with Us, the independent network of estate agents, said three-bedroom semi-detached homes are the gold standard, but the majority of estate agents are experiencing a shortage. A separate report, from the Bank of England, also warned yesterday of the chronic lack of homes which are available to buy in Britain. Its report, based on the experience of its agencies based in different parts of the country from Cornwall to Scotland, found widespread shortages of stocks for sale. The Bank said the number of homes available to buy is significantly below those of a year earlier in many cases, a fact which experts warn is pushing up house prices.
Recently, Nationwide said prices are rising by more than ten per cent a year in towns and cities, such as Manchester, London, Brighton, Cambridge, Oxford, Carlisle, Sheffield and Bath.
Move with Us said three-bedroom semi-detached homes are proving popular with both first-time buyers and second steppers, the name given to people making their first move up the property ladder from their starter home.
Mr King said: Many homebuyers are now opting to purchase three-bedroom properties as their first home. Theyre skipping the first rung of the property ladder, forgoing the starter home and moving straight into a property that they can grow into. He said many are so worried that house prices will continue to rise sharply that they try to buy as big a home as they can afford. On average, a three-bedroom semi-detached home takes 71 days to sell from the day that it is first listed with an estate agent to the day that it is sold subject to contract. In Ashtead, Kent, they sell in an average of just six and a half days, the report said. By comparison, the average home takes 126 days to sell, an extra 55 days.
Experts say stamp duty is fuelling the problem because the tax bill which comes with buying a home puts off many people from selling, hence the lack of stock available to buy. Many families decide it is cheaper to extend their current home, such as a loft conversion or a kitchen extension, than to buy a new home because they want to avoid a hefty stamp duty bill
Until 1997, stamp duty was charged at just one per cent on all homes sold for 60,000 or more. Today it is charged at one per cent only on properties between 125,000 and 250,000, three per cent up to 500,000 with rates continuing to rise to a maximum of seven per cent on homes over 2million. If you bought a home for 550,000, you have paid stamp duty at 5,500 at the beginning of 1997. Today you would pay 22,000, a huge disincentive to moving house. As a result, the average homeowner now moves once every 22 years, compared to once every eight years in the 1980s, according to recent research by the property firm Hometrack.
Mark Hayward, managing director of the National Association of Estate Agents, said: Stamp duty is an unfair tax. It requires people to part with thousands of pounds up front. In its current 'slab structure', it distorts the UK housing market, acts as a barrier to first-time buyers and is also prohibitive for those looking to move up the property ladder.
The number of homes being sold in the UK is picking up sharply, according to figures published today by HM Revenue and Customs. Last month, it said 106,070 residential homes were bought in the UK for 40,000 or more. During the recession, the number sold in March dropped as low as 63,410 in 2009.
But the Royal Institution of Chartered Surveyors warned recently the demand for homes is far out-stripping the supply of homes coming into the market.
Peter Rollings, chief executive of the estate agency Marsh & Parsons, said: In London, a shortage of available property in the face of growing demand has been pushing prices higher and creating a strong sellers market. A two-bedroom flat in Fulham, south-west London, which we recently sold received 72 viewings and 14 offers within the space of two weeks.