Nearly One Third of Houses are Brought for Cash in Rural Areas in the UK

Nearly one third of houses are bought for cash in rural areas The Commission for Rural Communities (CRC) has released a report Cash purchases of housing stock which shows that in 2005 over 47,000 houses were bought for cash in rural areas, equivalent to nearly one third of all rural house sales for the year. The South West of England had the highest proportion of cash purchases when compared to all other English regions.

The CRCs analysis of the most recent HM Land Registry data shows that in rural settlements a greater proportion of house purchases are wholly paid for in cash than in urban districts. The report also shows that

• In villages, hamlets and isolated dwellings in sparse areas nearly 50% of all purchases are made with cash.
• There are high proportions of houses bought with cash in districts where there are also high proportions of second homes, high percentages of households on low income1, high rates of net internal migration and high rates of population growth.
• Of 11 high-pressure districts that are experiencing the most extreme values of these inter-related factors, 10 of these are rural districts and 7 of these are located in the South West region.
• Of the 71 districts with the highest proportion of cash purchases, 53 are rural. Notably, coastal rural authorities, particularly those in the South West region, and those covering national park areas have the highest proportions of houses bought for cash.

Stuart Burgress, The Rural Advocate and the Chairman of the CRC said “Buying houses for cash in rural areas has increased the pressure on an already over stretched housing market and exacerbates the problems of affordability. Rural people are increasingly unable to live in the village or hamlet of their choice and wealthy people buying up homes for cash will simply make this situation worse.

He added “Buying houses for cash also has long term implications for the sustainability of the countryside. This pressure and others on the housing market was recognised politically by the creation of the Affordable Rural Housing Commission in 2006 and we will be reporting on progress one year on at a major conference in June.”