Older homeowners have typically been in their properties around 10 years longer than younger owners, as home mover activity in the UK remains subdued.
Those aged 35-44 who own a property with a mortgage have lived there for an average of 6.8 years, according to Nationwide Building Society’s latest house price index, compared to 17.2 years for those aged 55-64.
The building society said that a lack of properties on the market may be one of the factors behind many homeowners’ decisions to stay put.
“This has led to a less liquid market, which may be deterring some potential home movers from trying to sell their own properties – a trend which becomes self-reinforcing,” said Robert Gardner, Nationwide’s chief economist.
The number of properties changing hands is currently equivalent to around 5% of the total number of homes in the UK, compared to 8% in the run up to the financial crisis more than a decade ago.
More homes ‘under-occupied’
Low turnover in the housing market means that the past decade has seen a steady increase in the proportion of under-occupied homes, Nationwide said. These are homes which are defined as those with two or more spare bedrooms.
Over half (54%) of owner-occupied properties are currently under-occupied, compared to just 15% in the private rental sector.
Robert Gardner said: “There is a demographic aspect to this. Alongside the rise in under occupation, there has been a marked decline in home ownership amongst younger age groups, in particular, those aged 25-34 and 35-44.
“Under occupation tends to be less prevalent amongst younger households, whereas around two thirds of properties owned by those aged 65 or over have two or more spare bedrooms.”
First-time buyer numbers up
Competitive mortgage rates combined with a strong jobs market and government schemes such as Help to Buy have helped boost first-time buyer activity, which has returned to pre-financial crisis levels.
However, the decline in home ownership amongst younger age groups suggests people are getting onto the property ladder later in life.
“The declining proportion of younger owner occupiers may also be impacting home mover activity, as younger households tend to move more frequently,” said Robert Gardner.
Fewer people choosing to move combined with ongoing Brexit uncertainty has meant there has been little movement in house prices in recent months, with Nationwide’s latest data showing a modest 0.3% rise in July.
The average house price in the UK now stands at £217,663, according to the building society. Annual house price growth is also at 0.3%, the eighth consecutive month it has been lower than 1%.
Older homeowners stay put for nearly two decades