Moving home is a traumatic and stressful time, but it is also often the time when people consider buying goods that will make their lives easier. This is supported by new data from research firm BMRB’s Target Group Index (TGI), which measures the rate of home moving. The research shows that there is a direct relationship between decisions to move homes and major purchases.
How frequently people move is directly related to the economic climate. During the past 15 years, there have been big swings in the financial state of the country and the housing market has reflected this. TGI data from 1987, the height of an economic boom, shows that nine per cent of adults across the UK had moved home in the previous year. By 1993, as the recession deepened, this figure dropped to five per cent. Last month’s TGI data shows that this figure now stands at seven per cent.
During the same 15 years, the number of adults that have lived in the same home for 20 years or more has risen. In 1987 the figure stood at 24 per cent, but this has risen to 30 per cent of adults in the latest data. This is attributable to the sharp rise in property prices, which means many young people now stay in the parental home for longer. It not only stops the younger generation from getting onto the first rung of the property ladder, but also stops their parents from up/downgrading from the family home.
This data is supported by TGI’s findings, which show that adults aged between 55 and 64 years old are 79 per cent more likely than the average to have lived in their home for 20 years or more.
People who have been in their homes for less than a year tend to be younger. The 25- to 34-year-old group is twice as likely to have been in their home for less than a year than the average homeowner. Again, this can be attributed to the sharp rise in prices making it harder for young people to buy a home.
The groups that are most likely to move in terms of “lifestage” are defined in TGI’s data as “flown the nest” (aged 15 to 34, not married, and not living with family members) and “nest builders” (aged 15 to 34, married, no children). This is also the age group where people’s lives will go through rapid changes, through their career or having children, and as such they will move frequently to accommodate these changes.
There are regional variations in the frequency that people move. For example, the latest TGI data shows us that homeowners in Scotland are 18 per cent less likely than the average homeowner to have moved house in the past year. However, in the South-east they are 37 per cent more likely to have done so.
These regional variations have fluctuated in the past decade. In 1993, people in Scotland were a quarter more likely than the average to have moved in the previous year, whereas those in the South-east were eight per cent less likely to have done so.
As people move home more frequently, the white goods and new technology markets benefit. According to TGI data, one of the most notable purchases made when moving is a subscription to satellite TV. The data shows that those adults who have lived in their home for less than a year are one-third more likely than the average to subscribe to Sky Digital. Indeed, ten per cent of all Sky Digital subscribers have moved home in the past 12 months.
Similarly, recent movers are far more likely to buy expensive white goods such as washing machines and refrigerators. TGI shows that 20 per cent of households who have purchased a built-in oven in the past 12 months have also moved house within that time.
Obviously, the house moving market is important to the whole white goods market as people moving home are either buying these products for the first time or have decided to upgrade older products. This is supported by the data which shows that 20 per cent of households that have bought a refrigerator in the past 12 months have moved in the past year. Similarly, 18 per cent of households that have bought a dishwasher in the past year are also recent movers.
TGI data also shows that 19 per cent of people who own a laser disc player at home are new movers, as are 12 per cent of those who have a Webcam. This makes them 71 per cent more likely than the average homeowner to own one of these. However, it is likely that these products are acquired as part of a package, such as a home computer, being upgraded as part of the move.
The domestic electronics and technology markets find it hard to develop new growth. White goods particularly tend to be distress purchases. However, the house moving market offers these sectors new areas of potential growth. Marketers should look to tailor packages and campaigns to this market as, despite fluctuations in line with the economy, people will always need a place to live.