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Brits can’t move and won’t move
Homebuyers take a break and renters lose hope as consumer credit confidence hits new low
Nottingham, UK, 27 February 2008 - Impending fears of an economic downturn are beginning to hit home as consumer confidence in credit and borrowing falls for the second quarter running, with nine in ten (91 per cent) homeowners not intending to move and nearly half (48 per cent) of all non-homeowners saying they never intend to buy.
Figures from the latest Personal Credit Index research published today from CreditExpert.co.uk, the online credit report monitoring service from Experian®, show:
Rise of the Resigned Renters and the Non-Mover Improvers
As consumer confidence dips, with CreditExpert’s Personal Credit Index showing a two-point decline in the last quarter to 96, the research identifies two key groups:
Nine in every ten (91 per cent) homeowners are planning to stay in the house they currently own for at least the next six months, with many Non-Mover Improvers planning to add value whilst staying put. In fact, homeowners planning to make improvements are looking at spending an average of £11,142 on home improvements in the next six months.
Nearly one-third (31 per cent) of young homeowners (aged 25-34) who are staying put are planning major improvements, including adding conservatories, loft conversions or extensions, fitting a new kitchen or bathroom.
Nearly half (48 per cent) of those who don’t currently own their own home never intend to buy. Of these Resigned Renters – non-homeowners not intending to purchase – 46 per cent gave the reason that they don’t think they will ever be able to afford to buy, rising to 60 per cent of 35-44 year-olds and 56 per cent of 25-34 year olds. Location is also key, with 55 per cent of people in the South of England believing they will not be able to buy a property, compared to 39 per cent in the North.
Darryl Bowman, Director of CreditExpert.co.uk, said, “With consumer confidence in borrowing dropping two points in the last quarter amidst concerns of an economic downturn, it’s understandable that people are feeling that home-ownership is out of their grasp or that they should be ploughing money into home improvements rather than moving. Whatever your financial aspirations, making sure your credit report is in the best possible shape is crucial to allow you to be judged fairly by lenders and to be able to extend the amount you can responsibly borrow – particularly in the current credit cautious climate.”
Up in the South
The Index, which is based on survey data from Ipsos MORI gathered in January 2008, tracks consumers’ current credit confidence and future expectations on a quarterly basis. It also revealed that, despite the declining levels of consumer confidence, 40 per cent of home-owning Brits think that their house has risen in value in the last six months.
This figure rises to almost half (49 per cent) in the South of England. Even in the North – despite consumer confidence three points below the national average – 44 per cent of homeowners in the region believe that their property has risen in value.
Darryl Bowman continued: “Whether you are planning to buy a home or improve your current one, you should start by reviewing your finances. An online credit report monitoring service such as CreditExpert.co.uk can help by providing a summary of your credit status and alerting you to any changes in your credit report. You can get a 30-day free trial at www.creditexpert.co.uk.”
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For further information or to request an interview, please contact:
John Megaughin, the red consultancy, T: 020 7025 6414
Eleanor Moffat, the red consultancy, T: 020 7025 6564
Notes to Editors
About the research
Every three months, a representative sample of approximately 2,000 British consumers are asked questions covering their level of comfort with current borrowings, whether their borrowing has fallen or increased over the last six months and whether they expect their borrowings to rise over the next six months.
Mean scores for each of these questions are totalled to give an overall confidence score. Results from the first wave of research in January 2006 were rebased to 100 to provide a baseline and to clearly illustrate movements in confidence. All subsequent surveys are rebased by the same proportions to provide direct comparisons between surveys.
The survey was carried out by Ipsos MORI among 2,045 adults (aged 18+) who were interviewed across Great Britain between 17 and 23 January 2008.
For more information about the index, visit www.personalcreditindex.co.uk
CreditExpert is a subscription membership service priced at £6.99 per month, allowing unlimited online access to your credit report. The service comes with a free 30-day trial period that allows members to see and sample the service’s benefits.
CreditExpert provides UK consumers with unlimited online access to their complete Experian credit report. This includes details of loans and revolving credit with the accounts’ repayment history going back six years, the sources of the information, records of any organisations that have accessed the report and public information such as county court judgments, bankruptcies and electoral roll entries.
Experian responds to around one million requests for credit reports from consumers every year and helps many consumers with credit-related issues, including giving assistance to the victims of identity fraud. As the threat of identity fraud shows remains and the use of credit continues to grow in the UK, services like CreditExpert will become more and more important as consumers want help to manage their personal credit information and want to be alerted to changes on their credit reports that could affect their financial future.
The word 'Experian' is a registered trademark in the EU and other countries and is owned by Experian Ltd and/or its associated companies.