Impact of House Moves on the Household Goods Market - UK - April 2010
Following a property boom that started in the late 1990s, and which saw a rapid rise in house prices, the number of residential property transactions declined steeply between the second half of 2007 and the end of 2009. The housing market was severely dented by the squeeze on lending following the collapse of Northern Rock in 2007 and the banking crisis that led to the recession in the following year. Mortgages became more difficult to obtain and confidence in the housing market was hit hard.
- The household goods sector has been severely hit by the slump in the housing market. The number of households purchasing or selling a house or flat declined by over 40% to an only 700,000 between June 2008 and 2009.
- Household appliances and furniture show the strongest link with moving home. Between a fifth and a quarter of purchasing of goods in these categories is to households in their present home less than a year.
- The rented sector should not be ignored by retailers of products for the home. Any type of home move is likely to trigger purchasing of household goods and 10% of adults (4 million internet users) moved into rented accommodation in 2009.
- Bathrooms and kitchens are a priority for those buying homes in need of updating. Some 8% of those purchasing a house or flat in the last 12 months bought a new kitchen and 15% bathroom fittings in 2008/09.
- Household goods should be boosted in 2010 by more buying of houses and flats and improved consumer confidence. The desire to buy property is strong and 8% of adults who had delayed major improvements are now feeling more confident about spending.
- There is a high level of planned spending on home improvements for 2010 and further pent-up demand that is unlikely to be fulfilled in 2010. Wish-list purchases that are more likely to be deferred beyond 2010 include a new kitchen, bathroom or home extension.
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