Second-time buyers still seeing toughest market for decades
The problems faced by first timers attempting to get into the UK property market have been well documented over the last year. However, there are also sizeable problems facing those looking to move out of their first properties for sale and into a bigger house when it comes time to upgrade.
According to a new study which has been carried out by Lloyds TSB, second-time buyers are still facing some of the most sizeable issues surrounding the property market because of the fact that the price for their own home is so low, leaving them with negative equity and a lower chance of being able to afford their next house.
The fact that there are also a much reduced level of first-timers looking to move into the market is also causing issues, as it means there is less demand for houses traditionally bought by first timers, cutting the natural flow of the market and reducing the number of second-time buyers who can afford to move to a larger property.
The study discovered that the proportion of buyers who are moving from one house to another is now at its lowest level since 2001.
It was also found that the amount of equity that people come out of after selling their first house now amounts to just five per cent, compared to the average of 44 per cent that was seen in 2005.
Suren Thiru, housing economist at Lloyds TSB, said: "It is clearly very concerning that the challenges facing those attempting to take their second step on the housing ladder are the toughest for more than a generation. This follows the significant decline in house prices over recent years and the subsequent erosion of equity among those who bought for the first time at close to the peak of the market."
"The current problems facing second steppers have serious implications for the wider housing market, creating a bottleneck that significantly limits the number of homes available to first-time buyers."
Posted at 04:30 28/08/2012