Second steppers relying on rising house prices to upgrade their property could face a significant deposit shortfall when looking to buy a bigger home. New research from uSwitch has revealed that half (44%) of would-be movers don’t plan to save at all when buying a bigger home However, they could be in for a shock […]
Second steppers relying on rising house prices to upgrade their property could face a significant deposit shortfall when looking to buy a bigger home.
New research from uSwitch has revealed that half (44%) of would-be movers don’t plan to save at all when buying a bigger home
However, they could be in for a shock – growth in house prices has outpaced flats over the last 10 years, potentially leaving buyers short when they look to move up the ladder.
The study found that British house prices have risen by 21% over the past decade, while flats have increased by 15%.
With 62% of second-time buyers looking to trade up to a house and almost half not planning on saving, second steppers face a significant shortfall when they buy their next home.
The gap between the flat and house price growth rates is widest in Preston where it has grown to 16.5% over the last 10 years, followed by Colchester (10%) and York (9%).
In contrast, flat owners in Aberdeen, Wolverhampton and Bradford have seen property prices increase more than local houses at 10%, 3.5% and 1.7% respectively.
Wage stagnation and tougher affordability checks from lenders have made it increasingly difficult for many home owners to move up the property ladder.
Tashema Jackson, money expert at uSwitch.com, said: “Second steppers have been lulled into a false sense of security by rising house prices. In some parts of the country houses have far outstripped flats and so if you are looking to move up the property ladder you need to carefully plot your next steps.
“Whatever your situation, plan ahead to find out what you can afford and how much you need to save. Don’t just take the first mortgage offered to you – consult a range of providers to find the best deal for you as this will help prevent paying over the odds.”
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