Homeowners ready to take their second step up the property ladder say it’s harder than getting on it in the first place according to the latest Lloyds Bank Second Steppers report, which tracks the ongoing plight of home owners looking to sell their first property whilst buying their second.
As a result of the challenges faced by homeowners looking to take the second step on the property ladder, almost a quarter (23%) say that they’ll have children later in life than they had originally planned with 12% also saying that they will have fewer children. Some have said that they also had to change their career (13%) as a result of their challenge to move up in the housing market. Two thirds (64%) of the movers said their current home was too small, with location and garden space coming up next in the list of reasons to look for a new property.
The rise of moving costs, stamp duty and difficulty in finding the right property has meant that more than half (52%) of those still living in their first home said that they had planned on moving up the property ladder in the last 12 months but have been unable to do so - and only 9% said they would lower their asking price to attract interest.
Low savings rates have also been a contributing factor and Second Steppers say that it’s taken longer for them to save enough to take the next step. However, there are also challenges on the demand side, as they also report that that it’s harder to sell their current property now compared to 12 months ago (39%).
The rise in house prices seems to have had a positive impact on the situation, given that this population have typically been more exposed to negative equity in a downward market. Two-fifths of Second Steppers (39%) said that the rise in house prices will help them to sell their current property for the right price.
Andrew Mason, mortgage product director at Lloyds Bank, said:
“Moving up the property ladder has become more challenging for Second Steppers in recent years. The rise in house prices and moving costs, along with how difficult it is to find the right property means that they’ve had to wait longer than anticipated or even put off their move entirely until the right property comes along.
“Second Steppers seem to be very clear on what they want from their next property and will stay put and improve their current home rather than make any sacrifices. Our research also shows that most homeowners think ahead and understand that it could take up to four moves in total to reach their ‘dream’ home.”