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Second-steppers need to find £58,000 to plug financial holes

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Home owners need to find £58,000, up £15,000 year-on-year, to plug the gap between their current home’s value and the cost of their ideal second property.

According to research by Lloyd’s Bank so-called second steppers have to fill this financial gap despite average house price rises of 9.6 per cent and the beefed-up equity levels which have resulted. The figure of £58,000 is more than double the average first time buyer deposit of £25,848.

Despite this, second steppers are feeling more confident in the housing market than ever before. Just a quarter see economic uncertainty as a barrier to moving, a fall of ten percentage points year-on-year, while the number seeing negative equity as a challenge fell by 11 percentage points.

Fees and charges are still considered the main obstacle to moving house for more than half of second steppers, though 43 per cent say that increasing house prices have improved their situation and 40 per cent believe it will be easier to sell their property now than last year. The number of people concerned about the size of the deposit they require fell from half in 2013 to just 37 per cent in 2014.

Marc Page, mortgages director at Lloyds Bank, said: “The jump to the next step is growing quickly for second steppers, with the gap to the second home now being almost £60,000 nationally. 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.”

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