One in five people are less likely to buy a home in the near future than they would have been before the coronavirus lockdown started, but one in 10 are now more likely according to a survey.
Some 20% of people surveyed by PwC in September said they are now less likely to purchase a home over the next couple of years compared to their situation in February 2020.
Concerns about the labour market and personal job security, recent income losses and uncertainty about the future direction of house prices are weighing on people’s willingness to commit to buying a home.
But 10% of people surveyed said they are more likely to do so.
This may be partly due to a stamp duty holiday which is currently in place.
PwC released the findings as it predicted that if Covid-19 remains relatively contained, with with local and time-limited lockdowns, house prices could grow by around 1% in 2021.
But it said that, if the UK is placed back under national lockdown, house prices could plunge by as much as 7% in 2021, even if the second lockdown does not last as long as the first full lockdown imposed in March.
With home working likely to become more widespread post Covid-19, more people will be factoring this into future property purchases, researchers said.
The sectors where people most expect to increase their working from home are predominantly in the financial services, professional services and information and communication sectors which, when combined, make up 15% to 20% of employment in the UK, PwC said.
But in the manufacturing and retail industries, the number of days workers expect to spend in the workplace is unchanged or increased, potentially because these workers are looking to make up for income lost during the pandemic, it said.
A third (33%) of people aged 45-plus who live in London expect to move to a different region away from the capital the next time they up sticks.
Some people in this age group are likely to be more established in their career, which may potentially give them more opportunities to work remotely for at least some of the week, depending on their type of job.
They may also be earning more and in a better position to absorb commuting costs than some younger workers.
PwC also found that around three-quarters of 25 to 44-year-olds in the capital, meanwhile, are firmly of the view that they want to stay in London.
Jamie Durham, an economist at PwC, said: “The pandemic is making many people consider their next move carefully, whether that means holding off on buying a property altogether or indeed moving to locations they hadn’t previously considered.
“Our research finds that around 30% of those who previously thought their next move would be to a property in the city centre now want to live in the suburbs or towns and villages.
“Likewise, 19% of those who previously thought they’d move to the suburbs now think they’ll move to a town or village.
“However, young people wish to stay in the capital.
“This is interesting given they are the group that are most affected by job losses, and can least afford London house prices, but not necessarily that surprising given that it is where many of their friends will be based and the range of leisure opportunities the capital offers.”
Barret Kupelian, a senior economist at PwC, added: “It’s difficult to predict the impact that Covid-19 and an increase in home-working could have on house prices, but our research points out that potential house buyers are considering moving to smaller towns, villages and suburban areas, more so than before the pandemic.
“If this materialises, it could help rebalance some of the housing market in favour of the regions.
“The regions we expect will benefit the most from this change are those with good transport as well as digital links.
“This could have a variety of implications for businesses but also for local authorities, which will need to plan for this type of change.”
PwC asked 1,000 people about their willingness to buy a home as part of the research.