Second step on housing ladder increasingly expensive

Funding the move to their second home is costing 'Second Steppers' nearly £60,000, claims a new report from Lloyds Bank.

The gap is £15,000 more than in 2013 and £18,000 than 2012, double the current average first time buyer deposit

Regional differences mean that in the West Midlands, second steppers are actually looking for an extra £21,000, while those in East Anglia need around £80,000.

The fees and other general costs involved in moving home are cited by potential movers as the biggest barrier to taking the next rung up the property ladder.

"The jump to the next step is growing quickly for Second Steppers, " said Marc Page, Mortgages Director at Lloyds Bank. "However, as house prices are rising and barriers to the next step are reducing, confidence about selling the first home and being able to move up is increasing. For most regions of the country this is helping people make that jump across the gap to the next rung on the ladder."

Knight Frank/Markit’s latest 'sentiment' index shows that people in all regions think prices rose again in October and expect this to continue.

Tim Moore, senior economist at Markit, said: "October’s survey indicates that house price sentiment has cooled from the peaks seen earlier in the year, but expectations of future house price rises are well entrenched across the UK. Stronger labour market conditions and an improving domestic economic backdrop should continue to support housing market conditions during the months ahead.

"However, a repeat of last winter’s breakneck acceleration in house price growth is unlikely, given tightened lending criteria, subdued pay inflation and the greater possibility of future interest rate rises."

Figures out today from estate agent haart put the UK average house price at £203,135, with London still way ahead at £507,967, and first time buyers paying £160,218. CEO Paul Smith said that they now had nearly 10 buyers for every new instruction across the UK, compared to two years ago when the figure was eight.