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Demand for bigger homes easing property slump

Demand for bigger homes easing property slump

Category: Mortgages

Updated: 01/04/2010
First Published: 01/04/2010

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A returning demand for larger homes is helping push the property market out of its malaise, new figures show.

The National Association of Estate Agents (NAEA) said that the ability to buy larger style houses has become the main motivation for selling up.

In a survey canvassing the opinion of NAEA members across the UK, more than three quarters (78%) of estate agents said the main reason for new house purchases was upscaling.

By contrast, the same research conducted in February 2009 pointed to an increase in downsizing – a trend caused by the recession.

During that time, a four bed detached property dropped in value from just over £339,000 to £316,225, while the price of a two bedroom flat rose by 1.6 per cent.

This suggests that, at the time, sellers could not afford spacious homes and were forced into moving to a smaller property.

However, this trend appears to have ended, with upscaling being the prime driving force in the property market once again.

"The fact that there has been an increase in the number of people moving to a larger property suggests the UK is slowly emerging from the economic downturn," Peter Bolton King, chief executive of the NAEA, said.

"This may also be attributed to increased mortgage availability which is encouraging news for the property industry.

"However, while the recent stamp duty pledge announced in the Budget is great for first-time buyers, more needs to be done to assist those moving for the second or third time to ensure this upward trend continues."

Other common factors in moving house included divorce, debt and a new job.

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