Home » Uncategorised »
‘Second steppers’ getting market encouragement
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
New research has suggested that a number of so-called ‘second steppers’ in the UK housing market are now in a comfortable financial position.
A survey from Lloyds Bank indicates that a number of people looking to make the next step up the property ladder are being boosted by rising property prices and a steady increase in first-time buyers. The positive report comes despite the fact that additional figures suggest that many second steppers face a rise of £128,000 to move up the housing scale.[1]
Positivity
Lloyds’ report shows that 33% of second steppers believe that it will be easier to sell their property during the coming year. 37% said that they want to move soon to take advantage of the buoyant housing market.[1]
Undoubtedly, first time sellers are in a stronger position than they were five years ago. The rise in house prices have seen the equity of those living in their first homes, with 71% of respondents to the survey saying that they felt their position had improved in the last twelve months.
With prices at their lowest in 2009, many current second steppers would have purchased their homes in this troubled period. The average price of a first time buyer home is now 31% than it was in 2009. This means that the average second stepper has an average equity level of £87,096, which equates to 29% of the typical price of a second step home value of £304,963.[1]
The average estimated equity level has increased by in excess of £36,000 during the last year from £50,655, due to a rise in prices paid for first time buyer properties.[1]
‘Second steppers’ getting market encouragement
Affordable
The research from Lloyds also shows that the average cost of a standard second stepper home is more affordable than one year ago, in comparison with earnings. Housing affordability has grown substantially in the last year from 7.1% times the UK gross annual average earnings in 2014 compared with 6.4% in 2015.[1]
Despite growing house prices giving equity levels a boost, findings from the report also show that people living in their first property must find an average of £128,390 to fill the gap between the sale price of their home and the cost of their next desired property. This desired property was found to commonly be a detached home. The monetary gap drops to just £17,864 if the second-stepper wishes to move to a semi-detached house.[1]
[1] http://www.propertywire.com/news/europe/uk-second-step-property-2015060810599.html
