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Homebuyers stay calm despite economic uncertainty

The number of people intending to buy a new home in the next two years has remained stable at 11% for the third consecutive quarter, finds Alliance & Leicester&#39s quarterly movingimproving index.

Whilst this figure has fallen from a high of 15% two years ago, the findings suggest that there has been a measured cooling among prospective homebuyers.

While housing market reports are sending conflicting messages to UK homeowners and prospective homebuyers, the new findings bring calm to the house price debate, the lender says. Some commentators claim that house prices are on the brink of collapse, whilst others believe that a &#39soft&#39, rather than &#39crash&#39 landing can be expected, if there is to be any correction at all.

Confusion has been worsened by reports that a potential conflict with Iraq could send shockwaves through the UK economy.

The index has also found that reasons for moving continue to be driven by lifestyle factors such as changes in family circumstances, rather than economic reasons such as financial gain from the sale of property.

A&L&#39s quarterly movingimproving index asked a representative sample of 4,000 people whether they intended to buy a new home and, if so, when and why.

Paul Cooper, head of mortgages at Alliance & Leicester, says: “The latest findings from Alliance & Leicester&#39s movingimproving index suggest that UK homebuyers are remaining calm amid the frenzy of conflicting messages and warnings issued by property market commentators.

“For a long time we have observed that homebuying decisions are largely driven by non-financial factors and this continues to be the case. For most of us, a property is a home, not a financial investment.”


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