Time to Save
One in five homes in the UK were sold chain-free this year, down from one in three in 2015.
Chain-free sales are becoming increasingly rare. In the UK, most homeowners who move are reliant on the sale of their current home. While in some cases owners might briefly choose to move into rented accommodation to help with the sale of their home, most look to find a buyer for their own home at the same time as buying a property for themselves.
A chain is formed when two or more homeowners are reliant on the sale of their property simultaneously to fund the purchase of somewhere else to live. This year, only one in five homes (23%) in the UK have been sold chain-free, down from one in three in 2015 (32%). Investors, who tend to buy chain-free, have bought fewer homes since the introduction of the stamp-duty surcharge on second homes in April 2016, and have played a significant part in contributing to the overall fall. In June, landlords bought 11% of homes in Great Britain, down from 16% three years ago.
For other homeowners, affordability has been stretched as house prices have risen faster than wages. This has meant fewer buyers have had the luxury of moving without selling first. More recently house price growth has slowed, and as a result, homeowners aren’t accumulating as much capital as they were. Some movers, particularly downsizers, are choosing to sit tight until prices start rising again before they cash in on their property.
All that said, the rise in the number of landlords selling-up due to tax and regulatory changes go a small way to counteract the fall in chain-free sales. So far this year, landlords have made up 16% of all vendors in Great Britain. But even though these properties are now less likely to be snapped up by fellow investors, first-time buyers are stepping in, keeping the sale chain-free.
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