Homeowners “cash in” and opt for tenancy

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by Gill Montia

Research from the property website, iammoving.com, indicates that there is a drift emerging from home ownership to the private rented sector.

According to the survey, one in five of those planning to move house is considering exiting the property ladder while prices remain high.

Around 18% of homeowners questioned were prepared to move into rented accommodation if it enabled them to sell before the housing market shows a marked decline. They then plan to buy a home once prices have fallen.

The research also found that a further 14% of respondents were considering renting a home to release equity and ease financial problems.

In the past few months, most house price indexes have shown a gradual fall in the value of homes across the UK as the market continues to reflect the combined impact of higher inflation and tighter mortgage lending criteria.

The latest survey from the Nationwide shows a 0.6% drop in the average price of a UK home in March, taking the annual rate of inflation to 1.1%.

Simon Preston, chairman of iammoving.com, says: “You expect people to consider renting when the market is falling because there is a chance to make money, but 18% is a high figure.”

Commenting on the findings, Nicholas Leeming, director of website propertyfinder.com, says: “It’s a dangerous game to speculate on the property market with your own home and is not for the faint-hearted. The average property has to fall around 7% in value before you even break even once you take all the costs of selling, moving and then buying again into account.”